What the greatest technology investors say about Product

PRODUCT POSTS (24 posts)

The following is a list of the post titles by author under this topic.  Scroll further down this page to find the actual blog post by your selected author.   Author’s posts appear in reverse alphabetical order.  For example, following this list, Fred Wilson’s posts appear towards the beginning of the blog page, and Marc Andreessen’s posts appear towards the end of the blog page.   


Marc Andreessen:  Do Whatever is Required to get to Product/Market Fit

Marc Andreessen: What Causes Success


Brendan Baker:  Traction is the Only Thing that Matters to Investors


Jeffrey Bussgang: Why Twitter Picked Fred Wilson as its Lead Investor

Jeffrey Bussgang: Considerations when Determining an Exit


Jeff Clavier:  Jeff Clavier:  My Product Considerations


David Cohen & Brad Feld:  The Number One Startup Killer

CHRIS DIXON  (2 posts)  

Chris Dixon: Best Thing when Considering Raising Money

Chris Dixon:  Product/Market Fit: The Only Thing that Matters for a Startup

BRAD FELD  (1 post)

Brad Feld:  Brad Feld's Investment Criteria

BILL GROSS (1 post)

Bill Gross:  Test your Customer Proposition

ROB HAYES (1 post)

Rob Hayes:  Red Flags: Signals Not to Invest


Josh Kopelman:  Companies are Bought, not Sold

MIKE MAPLES JR.   (1 post)

Mike Maples Jr.:  Develop Customers while Developing Product

DAVE MCCLURE  (1 post)

Dave McClure:  Startup Success Often Boils Down to 2 Things


Howard Morgan:  The Best Execution Wins Out


Naval Ravikant:  5 Main Qualities of an Exceptional Startup

MARK SUSTER  (3 posts)

Mark Suster: No Great Science to Determining Valuations

Mark Suster:  Early Stage Technology Investments Come Down to 4 'M's'

Mark Suster:  Successful Entrepreneurs have these Qualities

FRED WILSON  (4 posts)

Fred Wilson:  What's the Magic

Fred Wilson:  Management is Relevant when Building Usage

Fred Wilson:  What Great Entrepreneurs Have

Fred Wilson:  Great VC’s Care Most About the Company


Great VC’s Care Most About the Company

Fred Wilson venture capitalist and Co-Founder Union Square Ventures

“I think that great venture capitalists care more about the company than they do their investment. []

They’re not focused on money, they’re not focused on how much of the company they own, they’re not focused on the financial metrics so much. [] They’re focused on strategy, product, management team, building a world class organization, all those things [].”

This Week in Startups, Fred Wilson, episode # 523, Mar 10, 2015 @ approx. 8.48 min.

What Great Entrepreneurs Have

Fred Wilson venture capitalist and Co-Founder Union Square Ventures

“He [David Karp, Tumblr CEO] has that thing that Ev Williams has, that Jack Dorsey has, that Mark Zuckerberg has, and lots of great entrepreneurs have:  he just knows how to build a great product and he has instincts about it, he knows what to do and knows what not to do.”

This Week in Startups, Fred Wilson, episode # 523, Mar 10, 2015 @ approx. 24 min.

Management is Relevant when Building Usage

Fred Wilson venture capitalist and Co-Founder Union Square Ventures

Once the product has been built, launched and achieved ‘product market fit’, “it is time to get more users or customers [as the company enters] the “building usage” phase.”

This means the team must now be built including more engineers to scale the product/service and more employees in product, customer support, marketing and business development, sales (if an enterprise/SAAS focus) and administration.  Team size will at least double from building product’s stage with upwards of twenty when the building usage stage is exited.

Management issues herein: 1. managing engineering (where most of the headcount now is), i.e., recruiting, retaining and sometimes terminating engineers.  “[The] right people [must work] on the right things, [teams must execute and] the right environment” must exist for engineering success. 

“[Many] technical co-founders and lead engineers [don’t] enjoy managing.”  Wilson suggests helping a lead engineer become a good manager or hiring “a VP Engineering who is a great manager and move [the] technical co-founder or lead engineer into a more technical role [ i.e., CTO or chief technology officer]”. 

2. Founder/CEO’s challenge of navigating more direct reports. With potentially 10 + direct reports, a founder/CEO in management crisis can occur. Wilson suggests “find[ing] [team members with] management talent or inclination and invest in their ability to help [] manage the team” while “building communication systems, business processes, feedback, and routines [to efficiently scale the business and team].  [He] suggest[s] that founder/CEOs [][work] with coaches [to build management skills].” 

While stage 1 (building product) focuses on individual contributors and stage 2 (building usage) continues as such, management becomes relevant at stage 2.  “Strong individual contributors are often not natural managers”, presenting the CEO with challenges.  Fred Wilson  The Management Team - While Building Usage Jan. 9, 2012  ;

What's the Magic

Fred Wilson venture capitalist and Co-Founder Union Square Ventures

“It’s the right person or people, with the right idea, packaged up with the right product at the right time in the right market…and  [] that’s the magic.”  Fred Wilson  #StartupStories: The Pitch @ 4.3 min into video, May 30 2012;  The Pitch:

Successful Entrepreneurs have these Qualities

Mark Suster Partner Upfront Ventures and former entrepreneur

 Suster believes successful entrepreneurs have these qualities:  “1. tenacity, the most important [].  2. street smarts []” including “[] know[ing] [] how customers buy and how to excite them [], [an ability to] spot opportunities that aren’t being met and [] design products to meet these needs. []”. “3. ability to pivot []” which “[] might just be a totally different business model.[]”  “4. resiliency  []. 5. inspiration [].  6. perspiration [].  7. willingness to accept risk []. 8. attention to detail [].  9.  competitiveness []. 10. decisiveness []. 11. domain experience []. 12. integrity  []”.    Mark Suster, Entrepreneur DNA, December 15, 2009; What Makes an Entrepreneur (2/11) – Street Smarts December 16, 2009

What Makes an Entrepreneur (3/11) – Ability to Pivot December 17, 2009


Early Stage Technology Investments Come Down to 4 'M's'

Mark Suster Partner Upfront Ventures and former entrepreneur

“[] [Almost] all VC investments in early stage technology & Internet investments come down to just four key factors []: management, market, money [i.e., valuation] and above all else momentum [i.e., mostly product momentum]. 

[] The number one thing that investors get their checkbooks out [for is] momentum.  [Momentum has various definitions]:  user numbers, revenue, channel partners, biz dev deals, [etc.]. 

[] [Suster’s investment decision is based] 70% [on] management, 30% [on] product. 

[] [Almost] all VCs care about investing in big markets with ambitious teams.

[] Most VCs want to own between 20-25% minimum of [a] company. [] [Investors need to] own enough [equity] to make it worth their time – thus “money”. And all of this is wrapped up in forward progress that [entrepreneurs] demonstrate over time.”   Mark Suster, The Four Main Things that Investors Look for in a Startup,  October 6, 2010





No Great Science to Determining Valuations

Mark Suster Partner Upfront Ventures and former entrepreneur

 “There is no great science to [how prices (valuations) are determined].  The earlier [one] invest[s] the higher the chances the company won’t work out and thus [one] pay[s] a lower price than later-stage investors. [An investor tries] to pay the appropriate price for [his] perceived risks of the company succeeding and protect [himself  if] it isn’t quite as valuable as [he] had hoped.  As the risks [] get eliminated the higher the valuation investors are prepared to pay.”  These risks over time are “[first] product [], [then] market [], [then] growth/scale [] and [finally] monetization/competition [].”    Mark Suster, Why Startups Should Raise Money at the Top End of Normal  June  5, 2011;

5 Main Qualities of an Exceptional Startup

Naval Ravikant angel investor, Co-Founder AngelList and Venture Hacks and former entrepreneur

“[Ravikant ] broke down the 5 main qualities of an ‘exceptional startup,’ in the following order:

1. Traction
2. Team
3. Product
4. Social Proof
5. Pitch/Presentation

[] [Ravikant] explained [] ‘Investors are trying to find the exceptional outcomes, so they are looking for something exceptional [],[so] do one thing exceptionally.  As a startup you have to be exceptional in at least one regard.’”

Naval Ravikant, Anatomy of an (un)fundable startup by Babak Nivi on June 22nd, 2011,  Ravikant’s keynote speech at the 7th Founder Showcase Q2 2011;

The Best Execution Wins Out

Howard Morgan Partner First Round Capital

“[Morgan] comments [that] wire frames or some progress toward a product should be achievable given how inexpensive it is to produce. [] [Morgan] cites a quote from [composer] Stephen Sondheim “Having just the vision is no solution, everything depends on execution.”   He contrasts incremental improvement against postponed perfection and states the importance of execution and the ability to ship product.  He says many people often have similar plans but the best execution wins out.” Howard Morgan Want to Know How First Round Capital was Started?  April 20, 2011;

Startup Success Often Boils Down to 2 Things

Dave McClure angel investor and Founding Partner 500 Startups 

“The ability to get real-time data and feedback is unique to the Internet. [] you can take advantage of that and build better products by collecting real-time usage metrics and by making decisions based on measured user data.

[] What’s really hard is simplifying your product and building a great user experience.

It’s important to start by building a culture of feedback and measured analytics into your process and your organization. [] start-up success often boils down to your ability to do two things: make money and make users happy.  If you can figure out how to do both of those things at scale, then you probably have an interesting business []. Luckily, you can tell if users are happy or not by measuring their behavior.”   Dave McClure, Obsess over Metrics, pg 183-184  Do More Faster  by David Cohen & Brad Feld 

Develop Customers while Developing Product

Mike Maples Jr. Founding Partner Floodgate and former entrepreneur

“[The] most important thing that angel-backed founders could do to increase their chances of success [is to] do customer development in parallel with product development. [] [Businesses] don’t just create products, they create customers. [I’ll] ask an entrepreneur, What’s your customer creation road map [and how many customers will you have created this time next year?] [] A lot of people think customer development is interviewing customers or spending time with customers.  In my view, you’re trying to create customers just like you’re trying to create product, and you create them at the same time.”  Mike Maples, Founder And Managing Partner, Floodgate, July, 2010;

Companies are Bought, not Sold

Josh Kopelman Partner First Round Capital and former entrepreneur

 “I [] believe that companies are not sold. They’re bought.

In every exit I’ve been fortunate enough to participate in – both big ( or Infonautics) and small (Turntide,,, e-Touch or Snapcentric) – the opportunity to exit was there only because we had begun to build a company that has differentiated technology, a strong team, offers customers real value, demonstrates traction in the marketplace, and/or solves a real need for the acquirer. You can’t build a company to sell it – I’ve never seen it work.”    Josh Kopelman, When the Music Stops…

Red Flags: Signals Not to Invest

Rob Hayes Partner First Round Capital

Hayes discusses red flags, things that would make him not want to invest in a founder or entrepreneur. 

Red flag:  If he doesn’t have the best possible people as part of the initial team pre-funding.  “When someone comes to [him] who has already surrounded [himself] with people [] who have quit good jobs [to come and work with him] because they’re so passionate about [] working with this person but also what they’re working on, [] that’s a good indicator.”

Red flag: “[] [The founder] is so enamored with [the] product [to the exclusion of addressing other important business elements.] There have been very few products that have been so good that the world just beat a path to their door [like Google or Facebook]. [] If someone is so enamored with their product that they can’t think through how things might change or they’re focused on one particular slice of the market and they only know that piece of the market and not a much bigger market [], I would be concerned about [that].”

Red flag: “[The founder says] now [he] need[s] to hire a designer[]. [] [Hayes likes] a product with design built in from the very beginning. [] When [Hayes talks] about design [he’s] talking about UX [user experience], feel, everything []”.  Rob Hayes, Rob Hayes of First Round Capital - TWiST #249, (ThisWeekIn Start Ups with Jason Calacanis), Published Apr. 18, 2012 @ 25 min.;


Test your Customer Proposition

Bill Gross Founder and CEO business incubator Idealab

“Find a way to test your core proposition with your customer, then manage your resources to adapt after that. Don’t spend the money in advance. You have to test the real customer proposition. You have to make the example be the actual test.”  Bill Gross: Here Are The 12 Lessons I've Learned In My 30 Years Of Being An Entrepreneur,  Dec. 15, 2011;

Brad Feld's Investment Criteria

Brad Feld venture capitalist and Managing Director Foundry Group

Feld discusses his investment criteria.  Feld first determines if the investment falls within his ‘filters’: US and Canada-domiciled early stage firms which have raised less than $3 million and fall within one of “[Foundry’s] [] [broad horizontal, abstract themes]”.  Assuming the investment fits within these filters, “[] then [Foundry] goe[s] incredibly deep on [] people and product. [] [Feld gets] excited about people who are super-obsessed about a product.  [] [If Feld wants to work with the entrepreneur, and the entrepreneur wants to work with him and is product-obsessed, and Feld has an attachment for that product, then he’ll invest.]  [] [Feld]  [already knows his markets, competitive dynamics, the business model.]  [] All [Feld] care[s] about is what [the entrepreneur is] going to do with the idea [] or the product or [where he’s taking] it”.  The best founding teams are 2-4 people half of whom are product-focused.  His optimal nascent team is 3 people, 2 of whom are product-focused, “all [of whom] are passionate [about] the product []”.  Brad Feld,  This Week in Startups # 319, published Jan. 9, 2013,  @ 25- 32 min. into interview with  Jason Calacanis;

Product/Market Fit: The Only Thing that Matters for a Startup

Chris Dixon General Partner Andreessen Horowitz, angel investor and former entrepreneur

“An extremely useful concept [] popular among startup founders is what [] entrepreneur and investor Marc Andreessen calls “product/market fit”, which he defines as “being in a good market with a product that can satisfy that market”.  Andreessen argues persuasively that product/market fit is “the only thing that matters for a new startup” and that “the life of any startup can be divided into two parts: before product/market fit and after product/market fit.”

But it takes time to reach product/market fit. [] [Dixon believes that] the best predictor of whether a startup will achieve product/market fit is whether there is [] “founder/market fit” [meaning] founders have a deep understanding of [their market], and are people who “personify their product, business and ultimately their company.””  Chris Dixon,  Founder/market fit, June 19, 2011;

Jeff Clavier: My Product Considerations

Jeff Clavier angel investor, Founder and Managing Partner, SoftTech VC

UPDATE Jeff Clavier:  My Product Considerations

During the Aug. 26, 2015  Bloomberg West TV show,  Jeff Clavier indicated that he now invests in business-to-business type companies (i.e., the enterprise space).  This accompanying post re: the consumer space was kept herein because his comments are still valuable and relevant for consumer-oriented companies.


“I look at the three typical factors [when investing]:  the team, the product, and the market.[]”

Here are his product considerations.  

“Because I invest mostly in the consumer space, I will ask, Do they understand consumer mechanics, customer acquisition, and customer retention. Do they think properly about the key metrics of the business and how to optimize them? Do they understand monetization? How do you make money [and how scalable is it?]

Then I look at the product, the concept, is it differentiated? Have I seen ten or twenty versions of this thing in the past? Is it unique? How defensible is it? How replicable is it? [] How can they grow this thing? []

[Clavier’s ultimate question]: how can you build a team that really has a scalable product into an interesting market?” Jeff Clavier, Seed Capital From Angel Investors: Jeff Clavier, Founder And Managing Partner, SoftTech VC; July-Aug. 2010;