Keys
to Venture Success
Luis Villalobos is the founder of the world’s
largest angel group (Tech Coast Angels)
He has the following insights on how Angels and Founders can collaborate
to build a successful business. |
There is a need in
many cases to “transform a company” into a great investment opportunity since
about 99% of the deals are not appealing to early stage investors (ie:
not really investment ready). However, experienced Angels with
business acumen and are sophisticated at venture investing, can help transform
average or good opportunities into great ventures. This contrasts with
the many examples where investors automatically “pass” when they see the
smallest concern in a deal.
Key to transforming
the company to increase investor appeal in the venture is the need structure
the company to –
A. Set ambitious (but
achievable) goals
B. Recognize the value of
great people
C. Think strategically
about how to move the business forward
D. Have operating
accountability
E. Provide a forum for
all Stakeholders to contribute, grow and excel
F. Understand the
importance of quality, timely decision making
G. Have strong “look
ahead” abilities and the courage to make changes accordingly
H. Create significant
shareholder wealth
To do this, the
CEO must have the following abilities -
Impeccable Integrity: In addition
to not disclosing material information, purposeful ambiguity, lying,
stealing, dishonesty, etc., the CEO needs to have the ability to identify
problems early and take responsibility to address the issues (as opposed to hiding
problems, making excuses, shifting responsibility, etc.)
Knows the Business
Model: The CEO needs to understand exactly what the business has
to do to be successful and is focused on them — including the nitty
gritty key aspects of product development and marketing, the operation, people,
business drivers, finances, industry and company statistics, etc.
Continually Measures: Piggy-backing
on the last concept, the CEO is continually tracking, analyzing, and adjusting
the key metrics of the business.
Knows how to Connect
the Dots: The CEO makes things happen.
Motivational: The CEO can lead and
motivate the team, recruit new members, communicate vision, and can execute on
the plan.
Focus on Value to the
Customer: The CEO needs to ensure the business is delivering high value to
the customer while generating revenue and profits for the
company. Importantly, to ramp the venture, it is recognized
Customer Satisfaction / Competitive Advantage / Sales = Success.
November 15, 2007