Our company VoltDB just announced a new financing. The Wall Street Journal wrote about it here.
The company is doing well, and we think it can be a driver of returns in our first fund. It is still early days, but with 400+ customers and counting, they are clearly finding a groove.
I’ve received a few emails and social media snippets of congratulations. I’m grateful for that, but I feel that the praise isn’t warranted.
And, there are two reasons. First, credit goes to the management team. They are the ones creating the value and are the stars. We investors are members of the supporting cast.
Second, every VC I suspect thinks about this: am I skillful or lucky? You see, VC is a high-stakes business. As I’ve blogged before, most companies do not even return to its VCs the capital they’ve raised, and only 7 percent of companies generate a 5x+ return.
Since 1998, when I entered the VC business, I’ve seen in the industry quite a few successes. And, a huge number of absolute busts. Someone has a hot hand, and then, poor returns for a decade.
Don’t get me wrong, for I love this business. But, I think a great motivator for every VC can be this: am I good, or am I just lucky?