The "Change the World" Gospel…

Calacanis one day, Sequoia the next -- the gospel according to the godfathers of successful start-ups and entrepreneurial investment. (Enough with my rambling...) What does a VC, banking partner, or PE look for in a company that will change the world? What matters most?


  • Is it a better balance sheet projected in Year3?
  • Is it a backlogged pipeline for 9-month fulfillment?
  • Is it complexity to rival the "Microsofts" of the planet?


Here are the insights of one of the world's most preeminent "success-spotters"...

----- SEQUOIA's Elements of Sustainable Companies -Start-ups with these characteristics often foretells the success of a business and the likelihood of it becoming a sustainable, enduring company.

We like to partner with companies that have:

  • Clarity of Purpose -- Summarize the company’s business on the back of a business card.
  • Large Markets -- Address existing markets poised for rapid growth or change. A market on the path to a $1B potential allows for error and time for real margins to develop.
  • Rich Customers -- Target customers who will move fast and pay a premium for a unique offering.
  • Focus -- Customers will only buy a simple product with a singular value proposition.
  • Pain Killers -- Pick the one thing that is of burning importance to the customer then delight them with a compelling solution.
  • Think Differently -- Constantly challenge conventional wisdom. Take the contrarian route. Create novel solutions. Outwit the competition.
  • Team DNA -- A company’s DNA is set in the first 90 days. All team members are the smartest or most clever in their domain. “A” level founders attract an “A” level team.
  • Agility -- Stealth and speed will usually help beat-out large companies.
  • Frugality -- Focus spending on what’s critical. Spend only on the priorities and maximize profitability.
  • Inferno -- Start with only a little money. It forces discipline and focus. A huge market with customers yearning for a product developed by great engineers requires very little firepower.


MORAL OF THE STORY: Read and re-read. Clip to your mirror. Save in your wallet...