A Blurb On VCs In Gen Z
Setting The Table
Question: when you take a term sheet from a VC, what is usually their value-add besides cash? That would be company building experience. The bundle they being to the table is usually composed of seasoned founders, operators, and investors who've been on the ground floor of world-changing startups, doing functions such as:
Building teams of engineers from nothing to hundreds or even thousands.
Standardized operations in year 2 that are still the Bible of a company in year 13.
Coached founders through some of the choppiest waters and decisions in the history of business. Note how relevant this is at the time of this writing.
Watched with a front row seat the concoction of breakthroughs in software, hardware, and design.
Wisdom that was obtained from being around the likes of the best to ever do it in the tech startup game
Carry lessons from being onboard ships that have burned through hundreds of millions in VC, ousted founders, bad employees, inferior operational structure, etc. IE, what not to do.
This list can go on, and on, and on.
Now, let’s spin this question around; would you take a term sheet from a firm you realized was arming itself with associates that were:
Some rando straight out of the ivy leagues telling you how to build your startup, yet don’t know any industry terms, aren’t engineers or don’t get the tech, and have no pulse on the market.
Anything outside the creator economy or Web3 is just not of interest or in their wheelhouse.
Oh, and offers no valuable network for company building. Unless you’re interested in, that’s right, the creator economy or Web3.
0 prior startup experience. Besides that high school digital marketing agency with 6 co-founders. Oof.
Never built a thing in their lives, likely couldn't if they tried (that’s why these youngsters chose VC, not startups). But hey! They most certainly DID write multiple essays on how to start a business in school.
Status seeking monkeys that live off what they’ve been told is how you win; signal.
This list can also go on, and on, and on, FYI.
The Punch Line
You probably aren’t taking this firms money, right? So, what’s all this hype about VCs in Gen Z? Last week, I was told we should bow at the alter of these people because they’re charismatic. Now, I know a plethora of charismatic, smart people; but is that a good filter for capital allocation towards tech startups? I don’t believe so. Having people in Gen Z filter out deals for their firms based on what’s hot in their demographic makes sense, but when it comes to a company building framework, what exactly do they offer besides trends they find on Twitter?
Let’s put this to rest once and for all.