Perspective, Pontification and Propoganda about Entrepreneurship and Venture Capital, brought to you by David Hornik of August Capital.

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Rob Stevens

Fanatacism on the part of the ownership/management isn't quite enough. You have to have incredibly high expectations as well, arguably more than you expect the customers to have. Nothing will kill a product faster than being fanatical about it, and end up pushing it in a different direction than the market wants it to go in. Also, you need to make sure that you get some fanatical customers who will give you that critical word-of-mouth advertising. That inital core group can make or break you.

That all said, TiVo is an interesting example of both. TiVo employees are fanatical about getting the product right, listening to the users, and pushing the software forward in interesting ways. At the same time, sometimes they ignore their userbase when it comes to requesting features that they want (such as the "free space indicator") because it would be difficult/impossible to do in a meaningful way. Regardless, that doesn't stop people from wanting the feature, but they aren't clueing into the fact that if so many people want the feature, maybe there's something else about the product that isn't making itself clear that they need to look into.

Fanaticism is great, even necessary. As long as it's not _blind_ fanaticism.

Derek W

Its a little hard to balance fanaticism and pacing though. Starting up a company takes a long time. Getting the first version of the product done, dealing with the first customer encounters, reworking the product, keeping the customers happy, showing potential for growth. Its going to be years to get traction. I'd take a slow burn fanaticism over red hot anytime.

As far as the new toilet: I'm sorry but "sensuality" should not be used in conjunction with any device I'm supposed to sit on when I need to poop. And heaven forbid there be a power outage when you need to go--I wonder if there's a manual override on the automatic lid.

Joel A

I think that fanaticism about one's own company or product can be a key measure of a company's success, but it can also be an achilles heel. There are many start-ups where the founders have all the drive, determination and faith to make their product or company succeed, but they fail. The reason for this failure often isn't anything to do with the product or the company itself, it's whether their fanaticism allows them to tweak things to meet the needs of the market. By listening to what the customers or market wants and doing EXACTLY what they want (even if it doesn't fit into your vision) helps make them fanatics. I've dealt with this problem lately and have had to convince a business partner that despite what he and might like, we're finding that our customers want something a little different.

With this knowledge, we've re-engaged. Made our product more customizable and are building customer fanatics.

David Hornik

I completely agree with you. As I've written before on VentureBlog, if you don't listen and adapt you will fail. So, to the extent that fanaticism interferes with your ability to listen, it is a bad thing. I certainly don't see the two things as mutually exclusive and hope that I invest in people who have both.

David Sifry

David,

Great article. I love what I do - and I love infecting other with that passion - and being infected by them. One of my favorite interview questions is to ask propsectives what they are passionate about, what they feel driven about.

One thing that has changed since I was a young buck only passionate in ideas and technology is that now I'm passionate about Being Of Service. And that helps to put things in perspective, especially the comments about blind fanatacism...

Dave

Andrew Carton

David,

I could not agree with you more - really superb article.

I don't know if you'll agree but I see four key ingredients that an entrepreneur must have to succeed.

Namely, passion, vision, commitment and a focus on execution through people. I believe that your discussion on fanaticism beautifully addresses the first and second.

Passion = Energy

Vision = Motivation (for him/her + others)

Commitment = Mental Fortitude

Execution = Leadership

As you point out, a good dose of luck is also always handy...

Andrew

Jeff Alexander

Of course, no one here noted that you misquoted the Python skit. The last "weapon" in the list should be "and a nice red cape."

Just for thoroughness, of course.

Jeff

David Hornik

For the record, while Mr. Alexander may have indeed listened to the Spanish Inquisition sketch with me those many years back when we were college roommates, that does not make him correct. The proper weapon is a "nice red uniform." End of story.

Susan Mernit

David--Another insightful post.

I agree with you and would say that while in some ways passion and fanaticism are similar, the fanatic is so focused and single-minded that they can't see anything else around them--he or she is fixated on meeting their goal and making the vision work.

Passion is a strong part of that--but so are consistency and stamina.

I hope you mention these ideas when we have the closing panel on investment at Blogon.

Jason Lemkin

David, great piece.

I agree 110%; I would bifurcate founders from subsequent employees & non-founding CEOs. If founders do not have this fanatacism, the company cannot work. Doing a venture-backed start-up can be very rewarding, but the risk-reward trade-off is a tough one, and probably doesn't make sense at a very rational level. Unless of course, you are a fanatic, in which case you see risk-reward differently than the rest. In that case, founding a company makes sense . . .

Employees hired post-founding are different. While they can be fanatical, it usually doesn't pay for them emotionally or financially. I don't look for senior employees who are fanatical, just those who are driven and whose personal career success will be substantially advanced by the success of the company.

One question I'd have is on the outside CEO brought in after the founders. It's much harder for the outside CEO to be a fanatic, practically speaking. He or she didn't invent it. He or she looked at a half dozen opportunities (if he or she is any good) and picked this one rationally as the best of the bunch. Perhaps this is one leading source of the inevitable conflicts between outside CEOs and founders . . .

Charlie O'Donnell

Here's a question... What is the role of fanaticim on the part of a VC? As GM goes through discussions of VCs, we debate a lot about GP's who "drink the kool aid," especially during the telecom/internet bubble. On one hand, one might quickly knock them for that behavior, but on the other hand, we think that, in some way, an entreprenuer wants that from his backers. Within the spectrum of personalities an entreprenuer might pick for his backers and board, do you think there is an advantage to being one of those VC's who can "get excited" rather than someone who is all business and logic?

Jason's comment about founders vs. outside CEOs and the inevitable conflicts there is also interesting.

David Hornik

I am hopeful that enthusiasm, even optimism, is not in conflict with sound judgment. To my mind the bubble wasn't an example of "fanaticism" run amuck in the venture business. It was an example of really bad decision making. A number of VCs invested in business models that just didn't make sense. Shame on them. But the mere fact that I am always wildly excited about the businesses in which I invest does not, to my mind, mean that I will not remain objective about their prospects.

Kevin Leversee

I can so relate to this post and in a sense because of it I don't feel so nuts anymore- "25 hour day" a crazy punk song reminds me of what it is like to found a company. The insane ability to spend every atom in your body to build something you believe in so strongly, sometimes borders on madness. I've always had a lot of passion, but nothing prepared me for what I'd turn into my second year of founding this start-up.

You need this level of passion to wake up day and do this...As Bill Gates says "No idea is good enough unless you have at least three people laugh"

By no means am I an expert or hold a candle to some of the great individuals we all read of, but I face each day with the knowledge I will do something better and learn something new.

And I seem to learn a lot these days... ;-)

Beef Jezos

Not to be a spoil sport, but fanatiscism is a double-edged sword. Sometimes the fanatic has chosen the wrong product to run with. I receive calls almost weekly from these types who have been trying to raise funding for an idea for 12, 18, or 24 months and can't understand why the world is "too stupid" to see the opportunity.

The worst case example is a man who has spent the past eleven (11) years trying to attract financing for a really dumb robbery prevention idea. His fanatical focus has cost him his marriage and significant income.

I tried to tell him that maybe it was time to drop the project. He responded by sharing some advice a millionaire friend had given him the week before, "Never give up!"

:groan:

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