Long live the Content - long live the King
At the foundation of any organization, there are a few elements that repeat over and over regardless of the industry.
- Team or who does what?
- Process or how they do it?
- Content or What they do?
- Vision or why do they do it? (other than to make a buck)
With more than half the world's population with Internet connectivity the question "where?" seems already redundant.
Without any of those elements or when they become weak the business model of any organization starts to crack. Whether it is a lack of human and creativity capital that eventually loses to more superior products and services or inefficiency which derails profits and either leads to bankruptcies.
Top management in early-stage companies after some point (hopefully past product market fit) only starts to focus on 3 out of 4 elements: Team, Process, and Vision. And that is understandable, they are more abstract and broader topics, to scale any organization there must a level of delegation, but in many in process of such delegation company in many times underlooked in the Content part.
Quick history relapse with Google shows how the noun lived through the Gartner curve over the last centuries from the hype of the printing press invention during the Renaissance to hitting the bottom afterward and starting to grow again with the invention of the radio in the early 1900s and then TV.
With significant technological advances every decade, the form of Content is also evolving. With the recent buzz in Machine Learning and AI being on every page of tech journals, it is the proprietary underlying dataset that is the Content, and not many organizations truly have them, many times it is a derivative of someone else's content. Forgetting to focus on the Content and ways to deliver it can cost the company its life: as was the case of Kodak and the smartphone industry, Blockbuster and Netflix, or the loss of IBM's PC battle which initially dominated.
It is the Content that brings value and it could be in various forms, educational insights, or entertainment in a form of the content article as much as a SaaS product and a physical iPhone that lets you browse the web.
How does this relate to Venture Capital?
Venture Capital fund just like any other organization follows this path. Here are a few of my thoughts on various aspects of it:
Team: it is DNA which is a combination of being accountable, trustworthy, inquiring, therapeutic, and risk-taking. More on the matter here
Process: the investment framework on how to analyze companies. More in great detail here
Content: it is the combination of doing quality transactions which is the core skill of a VC and what value-add you as an investor can bring to the table: your network, strategic bizdev, years of experience and emotional comfort for founders, ability to assist in capital raising, helping foster an exit or other platform related help which bigger fund have the leverage to provide.
Vision: That is the investment strategy of the fund. The Geo regions, the sectors, and stage, and the number of investments. Understanding your strengths and weaknesses here is highly vital to returning cash to your LPs.