Recently I was talking to a successful entrepreneur and he was telling me that he hasn’t decided if he’s going to start another company or go the venture capitalist (VC) route. He has the skills, resources, and track record to be a full-time, professional investor. One concern he has is that things won’t be as fast paced being an investor compared to rolling up your sleeves and getting in the trenches. Another concern is that he won’t be maximizing his value to society since he’ll be coaching others as opposed to doing it himself. A third concern is that he won’t have as much influence on things and won’t be able to control his own destiny in terms of the success of the investments.
One reason he’s really interested in being a VC is to get more economies of scale of his time by helping many entrepreneurs at once be even more successful. In addition, the day-to-day pressure of growing a business is on someone else’s shoulders likely resulting in a more relaxed quality of life for himself. A third benefit is not having all the eggs in one basket (a single startup) but rather having a portfolio approach. The entrepreneur enjoys working too much to not do anything.
It’ll be interesting to catch up him with again in six months and see what he decided.
What else? Would you rather be an entrepreneur or a venture capitalist?
One thought on “To Be an Entrepreneur or a VC”
I think being a good VC is a very tough job and should not be looked upon the easy route. Raising a fund, finding qualified companies, competing with the beat VCs for the best deals and then the time it takes to have a financial outcome. Plus, it has to be tough to work with crazy entrepreneurs every day! My vote is to do what you know the most about and where your passion is.