Venture Capital and servant leadership

There was a two page spread in the Sunday Times yesterday about the YouTube-Google deal.  It didn’t really add anything to the various commentary on the web last week, but if you missed all that it is worth a read.

What I liked though was the following quote from Mike Morritz – partner at Sequoia, the fund that backed YouTube:

“We cater to two constituencies: the founders and management of private companies who have selected us as partners and the limited partners who have trusted us with their money.

We want to do well by both, but founders and management come first.”

Nicely put, I thought.  And the founders and management part chimes well with the ideas of servant leadership that I gleaned from JP Rangaswami’s Confused of Calcutta blog.  A little while ago, in a post about managing in IT he summarised Max DuPree’s Leadership is an Art with the following three points.

  • The first job of a leader is to articulate strategy and vision.
  • The second and last is to say thank you.
  • In between, a leader should be a servant and a debtor to the led.

That struck a chord with me at the time and I have been musing on how it applies to a VC’s role with his/her portfolio companies.  The second and third bullet points apply directly.  The first is very important but applies in a collaborative sense.   Good VC’s will have an important contribution to make to strategy and vision.  The Chairman/CEO is the captain, but as there are many leaders in the best football teams so the VC has a leadership role to play in helping to set strategy and vision. 

At least, that is the way I like to work.