There is a single underrated, under-examined quality quietly but powerfully defining the arc of your career and the shape of your life. It underpins your educational path, your interpersonal relationships, your professional pursuits, and your net worth. It influences your choices large and small, from what you’ll order for dinner tonight to when you’ll have your first child, from the outfit you chose from your closet this morning to the career you are — or aren’t — pursuing. This trait determines both the texture and the speed of your days, and in high doses, it is the fundamental ingredient that unites all successful entrepreneurs: risk tolerance.
Venture capitalists (VCs) dominate the boards of venture-backed private companies today. In a 2017 study that looked at more than 26,000 such boards over three decades, researchers found that VCs took 50 percent of total board seats. That fraction is the result of many things: VCs requirement to take board seats as a condition to funding, limited planning for the most effective board composition, and a lack of concern for what type of background board members need to best serve the organization. It reflects what happens when companies follow the currently accepted practice of distributing one or two board seats to the lead investor in each funding round.
Of the companies that pitched us in Q1 of 2018, more than half came in without a well thought out financial model. Some brought no model at all, expecting to focus the conversation on narrative and vision. Others presented models that were shallow or incomplete. They missed an opportunity.
Our culture teaches entrepreneurs that the day they leave the company that they founded is the day they’ve failed. We’re trained to believe that a successful founder is a decisive, emotionless commander who takes charge, heeds the advice of few, never makes mistakes—and is carried out of his corner office in a casket. But is that really what entrepreneurial success looks like?