I'd posted episode un last year but that was more about how VCs look at investments and why they, or rather, we think a certain way. This post is inspired by this NYT op-ed piece -- the title of that piece isn't meant to imply anything about VCs! -- and is actually literally about how this VC's brain is wired.
To quickly summarise the op-ed: it makes the point that, contrary to today's received wisdom, teams aren't the best way to achieve creative and efficient solutions to hard problems. Solitary operators are often better since they have time to reflect, don't get influenced by or feel compelled to agree with other people's opinions, aren't in permanent meeting-hell, can benefit from privacy, and so on. This has implications for organisation structure, how people learn, even office ergonomics and how each person's daily calendar is organised. All quite fascinating but plenty has already been said in the NYT and it's not what this post is about.
The NYT article made me think of how I think my own brain is (or needs to be) wired to do my job well. I'm sure some of you think this is self-indulgent drivel, and you're probably right :-) but I loved hearing about this from a VC friend/mentor before I got into the field myself so just hoping to pass on the favour.
The one thing I'd say about the VC's mind (my mind) is that I am (or need to be) almost manically bipolar.
The VC I spoke to several years before I myself moved into VC told me that venture capital can be a lonely job. You need a lot of self-motivation and willingness to learn by doing. There's no large team around you to bounce ideas off, take the slack when you feel like taking it easy, blame when things go wrong, celebrate with when things go well, etc. No one telling you what to do or not do. This is all completely different from private equity or nearly any other job. You're essentially a lone ranger. This isn't a mode of operation that everyone is comfortable with.
At the same time, VC is also about working in large distributed teams and being responsible for the results and failures of not just one's own efforts but also several others. I know that sounds paradoxical but what I mean is that a VC isn't just an individual in a VC firm. He is also a member of several teams -- not only the (usually small) team within his own firm, but also the teams in each of his portfolio companies and the VC firms that he co-invests with. This extended family can be as big as a few thousand people often spread across diverse industries, depending on the number and type of companies in the VC's portfolio.
This means that, although he is a solo agent more often than not, he also needs to be an exceptional team player, manager/boss, extrovert marketer, engaging salesman, recruiter, influencer/thought leader, coach/mentor... Did I say bipolar? I should have said multipolar. (Disclaimer: I don't claim to fulfil these roles as well as I'd like. I only aim to do some of these reasonably well some day soon.)
Another way in which the VC is bipolar is that, IMHO, a good VC needs to be both incredibly analytical and highly creative. I am sure that some of you will say that is disputable whether a VC can ever be creative! The analytical aspect should be clear enough but creative? I think VCs need to be creative in the way they, for example, apply ideas and lessons from one industry to another. Or dealing with people problems. Or looking at a trend here, a data point there, and coming up with a solution to a problem elsewhere. (But is that analytical ability or creativity?)
And finally the most common way in which any VC worth his salt is bipolar is, of course, that he needs to be simultaneously very optimistic and very pessimistic by nature. You've got to be an optimist when you consider that the VC game produces perhaps one big success for every ten investments made, and those investments themselves made the cut only after a further 1 in 100 (or more) whittling-down process. Faced with those odds, wouldn't most, er, normal people sink irretrievably into depression? But no, the VC is ever-optimistic.
Or is he? If he only makes 1 investment out of every hundred or more that he sees, doesn't that make him an extreme pessimist about all those ideas on which hundreds of people have already spent considerable time, money and effort?
The word you're looking for, dear reader, is bipolar.