Suster: Excess capital breeds startup laziness while constraints force creativity
Mark Suster · 20 VC 085: Mark Suster @ Upfront Ventures on Being A Super Entrepreneur Driven VC · Nov 4, 2015 · at 7:30
Mark Suster is Managing Partner at Upfront Ventures. He discusses startup capital allocation and fundraising strategy with host Harry Stebbings.
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“A certain amount of constraint actually forces creativity, and when you have a little too much capital, you can take shortcuts, or you can throw money at problems, and it masks certain problems as well. So I'll just give you an example for anyone who's ever worked on a systems project. You know, if you create a system project and say, we have a year and a half to ship this product, and at the end of the year and a half, we're going to have built this great thing. You know, people are just going to screw around for the first six months, not for the sake of screwing around, but because you don't really get focused until you have the urgency, the sense of urgency that you have to deliver stuff. So I always tell people like, If you have the same systems project, and you say, well, we're just going to ship version zero dot four, but you have to get it done in three months, in those three months, you're going to be insanely focused, because you know you're going to be judged based on shipping that product, and the same is true with capital. Too much capital creates a certain laziness and people create shortcuts, and that, I think, leads to making a lot of mistakes.”
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