Four Things Some VCs Do That I Don’t Like // ben’s blog

They confuse pattern matching with knowledge

As a VC, I have come to understand the value of “VC pattern matching.” Experienced VCs have been on dozens of boards and seen thousands of deals. As a result, they recognize patterns of strategy and behavior that generally work, and patterns that generally fail. This is very valuable information for an entrepreneur who, if lucky, only sees one deal in his career.

Unfortunately, many VCs overreach with their pattern matching. Rather than saying, “Most companies who sell at this stage, regret doing so, and here’s why,” they’ll say, “Don’t sell now, that’s a stupid idea.” Other commonly expressed and incomplete patterns include “don’t hire very fast”, “hire faster”, “don’t build a sales force”, “build a sales force”, “don’t build downloadable software”, and “build an iPhone app”.  None of this is useful input for your specific company.

A pattern-matched instruction without a rationale provides very little help. Either admit that you are pattern matching and that pattern matching is limited, or explain yourself.

Confusing pattern matching with knowledge doesn’t just affect VCs, it affects just about any situation where we are trying to solve a problem. Great blog post by Horowitz, that only hints at an alternative. The alternative is discussing past situations in the context of the current situation to see how similar or different the current situation is to past situations. Only then can reasonable decisions be made. We all need to recognize that no two scenarios are the same. We also need to recognize that post-decision we need to monitor whether or not it was the right decision through measurement and analysis.