Venture Capitalists should push entrepreneurs as hard as possible and help them solve their toughest problems, according to Vinod Khosla, founder of Khosla Ventures, former cofounder of Sun Microsystems, and former investor at Kleiner Perkins Caufield & Byers. The green tech investor emphasized a professional relationship over a more personal one. His remarks came at a talk on March 9 at the 2013 South by Southwest conference.
The primary job of the VC, Khosla said, is to help entrepreneurs avoid or minimize risk, think about the issues and strategic ideas they may miss, and maximize potential.
Khosla also said that VCs should look for companies that build diversity into the culture of the startup early on. “The more debate you have and the more questions you have (the better). It’s really important not to have everybody come from the same background… Disagreement isn’t the same as disrespect.”
Khosla has a test for his CEOs that other VCs can try out, called the Sunday night test: “…look at what you’re doing Sunday night. Half your calendar should be free. If not, you’re mostly reactive, not proactive. You’re not leading the team where it needs to go…You’re reacting to emails and phones calls.”
He also said startups should make sure their investors are the best ones for their company, not just the ones with the highest offer.
“When looking for funding you shouldn’t be looking for the best valuation, you’re looking for the best help for the particular risks you face in your venture.”
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