Venture Investor’s Playbook: The Recap

1_ZYq65VoLzCcuxcxxBOa3xg4 Success Factors for Early-Stage Venture Investors

This article is the final installment and a summary of a six-part series that was posted on the Flybridge Medium page outlining my experience on what it takes to be a great venture investor.

Over the last few weeks, I’ve shared my in-depth thoughts on the importance of big winners, why it’s crucial to get in front of massive trends, how to successfully execute business on a daily basis, and how to be an adept portfolio manager. While I focused on early-stage (pre-seed, seed, Series A) venture investing, many of the lessons I presented are broadly applicable.

Whether you’re new to venture capital or simply honing your craft, these four ideas will help you stay grounded as you evaluate, commit to, and nurture investments in your portfolio.

Want to take these key success factors with you? Download this cheat sheet.

1. Obey the Power-Law of Venture Returns.

Massive winners define great venture capitalists and great venture capital funds. The best investors fully internalize this power-law of venture returns and seek to back companies that can become “outliers”. Massive wins are all that matters in driving outcomes.

Read more about the Power-Law in the full post here.

2. Stay Ahead of Market Trends.

A key to investing behind the best companies is to identify macro market trends early and to ride the waves of growth they create. High growth companies need the wind at their back, so investing early behind emerging trends that develop quickly creates an environment for young, growing, businesses to flourish.

Read more about staying ahead of market trends in the full post here.

3. Master the SSWISH Cycle.

To be a great investor, you need to master the cycle of Seeing-Selecting-Winning-Investing-Supporting-Harvesting. “SSWISHing means you need to see many opportunities, select the best ones, win your way into hot deals, support your companies’ growth, and navigate a path to generating liquidity from your investments. Each stage feeds off the others.

Read more about mastering the SSWISH cycle in full in these two parts:
1. Seeing & Selecting opportunities
2. Winning, Supporting, and Harvesting opportunities

4. Lean into Your Wins.

The best-expected-value returns are most likely the companies in your portfolio that are killing it, so lean into your winners with more capital. Smart follow-on decisions should be married with a starting portfolio of more, rather than fewer companies, to account for the inevitable randomness in returns and performance.

Read more about leaning into your wins in the full post here.


Take these success factors with you by downloading this one-sheet.

I would like to thank my Flybridge partners Jeff Bussgang and Keegan Forte; all my XFactor partners, but especially Danielle Morrill, Aihui Ong, and Anna Palmer; the Columbia Business School students in Angela Lee’s class, “Foundations of VC”, that saw an early presentation on this topic; and my family for their collective input to and inspiration for these posts, although as always any mistakes and omissions are all mine.