18 Lessons From 18 Years in Startup Investing
Some simple and practical insights learned from my journey in venture capital
I never set out to become a venture investor.
The typical paths into venture are well-worn: former investment bankers, corporate lawyers who've advised on VC deals, or founders with successful exits. My journey started elsewhere—as a software engineer who found himself tackling increasingly complex management challenges.
My final role in the corporate world was as a Chief Digital Officer at a major bank, where I led a complete digital transformation. Starting in 2008 with no digital presence, we built a platform that reached 70 million monthly active users by 2015, larger than the combined user bases of Bank of America, Citi, and Chase. We pioneered mobile payments, super apps, and in-app services years before they became standard.
Then came the leap to Silicon Valley and the creation of our venture fund, R136.
Ten years later, we've grown from a small initial fund to nearly $500 million in committed capital across more than 40 companies. We've had several successful exits, with promising ventures still in the portfolio. The full story of our success remains unwritten.
What follows are the lessons that shaped my journey—not abstract theories, but practical insights earned through triumphs and mistakes.
Fundraising & LP Management
1. Build your brand early—and keep building it
During one of our first fundraising meetings in Silicon Valley, a prominent LP asked: "Who are you again?" They weren't being rude—they genuinely had no idea who we were or why they should trust us with their money.
Your brand isn't a logo or tagline. It's the collective impression people have when they hear your name. As a GP, think of your brand like Coca-Cola or Rolex—it should be recognized, remembered, and trusted. Even if you're not Marc Andreessen, invest in clear, consistent storytelling.
2. Secure an anchor investor first
We spent nine months trying to raise our first fund without an anchor, having dozens of meetings that led nowhere. Then we focused on securing one significant commitment—about 30% of our target. The remaining capital came within weeks.
The point: find someone who can commit 20–40% of your fund. Everything becomes easier once you have that initial validation.
3. Fundraising never stops
Between our second and third funds, we took a six-month break from LP meetings. Big mistake. When we returned to fundraising, we had to rebuild momentum from zero.
For a VC, fundraising isn't an event but a lifestyle. The most successful firms are always cultivating their next fund, even when they've just closed one.
4. Create FOMO
When one pension fund was wavering on investing with us, we mentioned that their competitor had already committed. They signed within 48 hours.
Most LPs are motivated by fear of missing out. Give them a reason to act fast—show them what they'll miss if they wait too long.
5. Find value asymmetry
We realized early on that competing for LPs who had access to Sequoia or Benchmark was futile—they would always choose the established names. Instead, we targeted investors who were excluded from top-tier funds but still wanted exposure to early-stage tech.
Focus on LPs seeking more than just returns. Some want strategic insights into tech trends, others want access to startups for potential partnerships.
6. Deliver more than just IRR
One of our most loyal LPs has never once asked about our returns. What they value is the quarterly technology briefing we provide their executive team.
Different investors want different things. Some seek strategic insights, others want access to innovation, and some simply want to be part of something exciting. Offer them more than financial upside.
Startup Investing & Founder Relations
7. Build your network as much as your brand
Our best investment came through a former colleague who remembered me from my days in banking. The company wasn't raising money, wasn't on TechCrunch, and wasn't on anyone's radar. It's now worth over 50x our initial investment.
Your best deals will come from your network. Be generous, connect people without expectation. Give first—these actions create the relationship capital that drives exceptional deal flow.
8. Always invest in people
We once passed on a company with incredible technology because we couldn't get comfortable with the founding team. Three years later, the company shut down after burning through $80 million. The technology worked, but the team didn't.
At every stage, success and failure hinge on people. The founders, the executives they hire, and the board members guiding them—these human factors outweigh market size, technology, or business model in determining outcomes.
9. Challenge assumptions—even if it means being controversial
During one board meeting, I challenged a founder's growth strategy so directly that the room fell silent. It was uncomfortable, but necessary. Six months later, that founder thanked me for the pushback that changed their company's trajectory.
Make an impact. Be proactive, involved, and helpful. Founders should remember you not as a burden, but as someone who truly helped, even when help meant difficult conversations.
10. Differentiate yourself post-investment
When one of our portfolio companies faced a PR crisis, I spent three days helping the CEO craft their response strategy, even though I wasn't on their board. Now I'm the first person they call when facing difficult decisions.
Find a niche where you're better than others. Be the person the CEO calls not because they have to, but because they want to.
11. Don't throw good money after bad
We invested in a marketplace startup that showed early traction but struggled with unit economics. Despite my emotional attachment to the founders, I declined to lead their next round. They raised money elsewhere, burned through another $20 million, and eventually shut down.
Stay rational. If a company no longer makes sense, don't double down just because you're emotionally invested. Ask: Would I invest under these conditions if I were new to this deal?
12. Learn to say no—and mean it
For every deal we've done, we've declined hundreds. One founder I rejected later built a unicorn. When we met years later, he thanked me for my direct, honest feedback when turning him down—it helped him reshape and rethink his approach.
The hardest skill in venture is rejecting good opportunities to pursue great ones. Your time, capital, and attention are finite. Be decisive and clear when declining—founders respect honesty more than vague encouragement.
Internal Team & Operational Leadership
13. Hire people better than you
Our head of operations came from a much larger fund and was familiar with processes I had never considered. Hiring her felt expensive at the time, but her systems saved us from countless costly mistakes.
The best VCs surround themselves with people who outshine them in specific domains. Your goal isn't to be the smartest person in the room—it's to build the smartest room.
14. Create clear decision frameworks
After several investment disagreements nearly fractured our partnership, we developed a scoring system that forced us to evaluate opportunities more consistently. The framework isn't perfect, but it creates a common language for discussing deals.
In venture, you're constantly making decisions with incomplete information. Develop frameworks that allow your team to evaluate opportunities consistently and communicate clearly about them.
15. Build a culture of intellectual honesty
During one investment committee, our newest associate dismantled my thesis for a deal I deeply believed in. It was uncomfortable, but he was right. We passed on the investment, which later failed for exactly the reasons he identified.
The most dangerous thing in venture is confirmation bias. Create an environment where challenging assumptions is expected, not penalized.
16. Manage cash flow meticulously
Between our first and second funds, we nearly ran out of operating capital because we mismanaged our management fees. A three-month cash crunch forced us to delay hiring key team members at a critical growth moment.
This seems obvious, but I've seen funds struggle with basic operational finances. Understand your burn rate, plan for the unexpected, and know exactly when you need to raise your next fund.
17. Take the long view on talent
Our first analyst is now one of our partners. The investment we made in her development has paid dividends far beyond what we could have gained by treating her as a disposable resource.
The associates you hire today could become your partners tomorrow. Invest in developing junior team members instead of simply extracting value from them.
18. Stay humble—luck plays a bigger role than most admit
Our first big exit came from a company that pivoted entirely away from its original vision. We'd like to claim we saw the pivot coming, but the truth is we invested in a different business than the one that succeeded.
After a decade in this business, I've come to appreciate how much randomness influences outcomes. The best investors reduce luck's influence through rigorous processes, but they never eliminate it.
The Engineering Mindset in Venture Capital
Looking back on my journey from software engineer to venture capitalist, I see how my technical background shaped my approach. Engineers are trained to break down complex systems into solvable problems, to test hypotheses rather than relying on intuition, and to iterate based on feedback.
This mindset serves me well in venture capital. When evaluating startups, I instinctively look for the core assumptions that must be true for a startup to succeed. When working with founders, I focus on helping them solve specific problems rather than offering vague advice.
The venture business appears glamorous from the outside—and occasionally it is. But most days, it's about showing up consistently for founders who are fighting incredible odds to build something meaningful.
It's about making difficult decisions with imperfect information. It's about maintaining conviction when others lose faith, and admitting mistakes when evidence proves you wrong.
I entered this industry almost by accident, but I've stayed because few roles offer the same opportunity to help shape the future. Each fund we raise and each investment we make is a chance to support the builders creating tomorrow's reality.
That responsibility—to founders, to LPs, and to the future—drives me far more than financial returns alone ever could.
Very well done, Victor. I like the way you've broken down something very complex into simple-to-understand bites. The engineer's approach.