Notes from a Venture Analyst

After spending three years as part of the investment team at Good Capital, I've come to realize that venture analysis boils down to four fundamental elements. While I haven't mastered any of them (and wish I'd understood their importance when starting out), these pillars have shaped my understanding of what makes a good investor - and by extension, what we look for in founders.

Reading: Beyond Surface-Level Tech Trends

Venture capital operates at the intersection of frontier technology and business models. In my time here, I've watched AI evolve from a buzzword to an all-pervasive force, like mobile apps and the internet before. But following tech trends isn't enough.

The secret lies in understanding the underlying structural forces. When evaluating startups, we're not just looking at what's technically possible - we're trying to understand how these possibilities create new opportunities. This requires a deep dive into both new and old businesses across industries.

We need to understand the players involved, their incentives, historical innovations, market dynamics, and most importantly, why certain problems persist. This context becomes invaluable when assessing how new technologies might reshape existing business models or create entirely new ones.

Talking: The Art of Value-Added Conversations

A significant portion of my day involves listening to founder pitches, talking to customers, and engaging with operators and fellow investors. But it's not just about gathering information - it's about building relationships through frequent, high-quality conversations.

I've learned that every interaction should create value for both parties. The person on the other side should walk away feeling their time was well-spent, having gained something meaningful from the exchange. This is exhausting work, requiring constant energy and context-switching.

The key ingredients? Authenticity builds credibility, while humility and curiosity enable learning. Without these elements, conversations become transactional rather than transformative.

Experimenting: Getting Our Hands Dirty

Here's something I wish more people understood about venture capital: startups exist to disrupt established norms and pursue innovation, but it's impossible to fully grasp the challenges involved without firsthand experience.

While operators-turned-investors understand this naturally, those of us from different backgrounds need to actively experiment. By tinkering with products and undertaking personal projects, we begin to understand user psychology, monetization challenges, and the practical applications of technology.

This hands-on experience does more than foster empathy - it expands our thinking in ways that theoretical knowledge simply cannot. When founders share their challenges, our own experiments, however small, help us better understand their journey.

Writing: The Ultimate Test of Understanding

Perhaps the most critical skill - and one I'm still working to improve - is writing. In venture capital, we're constantly consuming and processing information across a wide range of topics. Writing becomes our tool for critical thinking and clarity.

Think of writing as a litmus test for understanding. Can you explain complex ideas simply? Can you articulate why something matters? In an environment where more things can go wrong than right, and uncertainties outnumber certainties, clarity becomes crucial.

I've found that truly understanding something means being able to explain it simply. This isn't just about communication - it's about the depth of comprehension that good writing demands.

Why This Matters

While most discussions about venture capital focus on deal flow, due diligence, and portfolio management, I've found that success in this field ultimately comes down to these four fundamentals. They form the foundation for everything else we do.

For founders engaging with VCs, understanding these elements can provide valuable insight into how we think and process information. More importantly, these skills - deep reading, meaningful conversations, practical experimentation, and clear writing - are just as crucial for building companies as they are for investing in them.

These reflections come from someone still learning the ropes, but they're lessons I wish I'd understood from day one. Whether you're on the building side or the investing side, mastering these fundamentals can make all the difference.