Venture Capitalist Warns Greed Isn’t Good
VC Fred Wilson has written a piece in his blog entitled Greed isn’t Good when you’d expect someone who regularly deals in millions and billions of dollars to say quite the opposite. I find that refreshing.
A Lesson in Leadership
For more than a decade, we have recruited for some of the hottest venture-capital-backed-startups out there. When VCs invest in a company, they look for startups capable of reaching a billion dollar valuation. They deal with dollar amounts with lots of commas. So when VC Fred Wilson of Union Square Ventures cautions against greed, we should pay attention.
VC Fred Wilson’s comments appear to be pointed at the financial services, technology, real estate, and cryptocurrency sectors. Bitcoin Cash is up 50% today. Mr. Wilson observed it was up 100% a couple of days ago, making it “a thing”.
But no matter what the context, the VC’s anti-greed commentary is designed to challenge the Gordon Gekko stereotype we hold in our minds from the movie Wall Street where actor Michael Douglas uttered the memorable phrase, “Greed is good.”
I pay attention to what VC Fred Wilson says because he’s one of the leading bloggers in venture capital. That’s a sandbox we play in. We build out the executive teams of venture capital startups as they scale. We make it a practice to deliver marquis-name leadership so the startups don’t run out of runway from a lack of capital. We regularly deliver luminary talent that attracts venture capital investment for each subsequent round. In doing so, we have helped our clients become billion-dollar unicorns.
While innovation and technology are the drivers, at the end of the day, venture capital investment is all about the money. When it comes to their portfolio of investments, the investments, collectively have to pay off. Often, all it takes is a single unicorn to make fund successful. So, in venture capital, the thinking pretty much is “Go Big or Go Home”. That’s why they think in amounts with 3 commas or more. The series Silicon Valley pokes fun at venture capitalists’ hyper-focus on billions. (Warning, adult language is used.)
Tres Commas is Not Good For Business
But VC Fred Wilson posits that greed is not good for business, especially when there’s “a lot of money sloshing around”.
I would add that greed is one of the 7 deadly sins for a reason. Greed, which is also known as avarice, lays the groundwork for all sorts corporate malfeasance: Trickery. Manipulation of authority. Cooking the books. Theft and robbery. Even violence.
While it makes for memorable scenes in movies, greed is capable of destroying companies and the people who work for them. It is also capable of destroying families. I witnessed the greed of a sibling destroy the family my parents built. It was utterly heartbreaking.
So how do you know when your desire for material possessions is tipping over into greed? Quite simply, it is when you want more than you really need. That is the definition of greed.
Seriously, we need to check ourselves.