We believe entrepreneurs should demand that their VC investors do more than just give their time, make valuable connections, and offer strategic insight. Those things – while important – are just the table stakes.
True partnership means being honest about present threats, and having the mutual trust to navigate those treacherous waters together. It means being accountable to each other and having a willingness to make difficult choices. It’s earning the trust to have the hard conversations about building teams and inventing product and unearthing new market opportunities, and working through these very real challenges together. It means being open about mutual interests, as well as being upfront about where those interests diverge.
These beliefs lead us to do the necessary work to be the best partners we can be. We have been known to sweat through the night, side-by-side with a company founder, helping to carefully construct messaging just days before a product launch. We’ve incubated small teams with big ideas that later grew to become massively disruptive technology powerhouses. We are often found taking long walks with product leads to discuss strategy and user experience design.
We invest in recruiters and executive talent leads to make it easier for portfolio company CEOs to build their teams. At many companies in our portfolio, we helped build out more than half of the core engineering, design and product teams. Because of our investment in talent operations, Greylock portfolio companies make an offer to an engineer or product manager every other day and we have filled more executive boards than most other VC firms.
Our investment partners sit on fewer boards than partners at most other VC firms. This is because we believe that in order to create maximum value for the companies we back, we need to be generous with our time. This also means that we are often the last VC to leave a board.
We understand that while we have many portfolio companies, each individual entrepreneur will have their whole lives riding on their one company. We go much further to recognize this conflict and do everything we can to bias on the side of the entrepreneur. We believe entrepreneurs deserve this commitment.
This may be because we act collaboratively and with integrity; we do not act transactionally. We care deeply about building long term relationships with entrepreneurs. We negotiate a good deal, but the deal doesn’t define us. We push entrepreneurs to build exceedingly great companies and help them to make the hard choices along that path. We are biased to worry about being fair to the entrepreneur and fair to the employees.
We extend this view about partnership to our limited partners. We are unusually transparent with them, and proudly so. We meet with our LPs twice a year and we share details about our operating budgets and our expectations of future fund performance. We do not distribute excess fees to our partners, we send them back to the LPs. We deliberately chose to keep our pool of LPs small and uncomplicated. We go out of our way to treat them well and behave as reliable partners. As a result, we are able to raise funds quickly and our LPs have been with us for decades.
We also think of other VCs firms as our partners. No question, we operate in a ferociously competitive industry. But we also recognize that partnering with another VC firm may be the best path forward for the entrepreneur and for the company – as long as everyone shares the same values. To that end, we are also quite comfortable saying no to entrepreneurs and others who do not share our view of partnership.
We make succession planning a priority for the firm, and invest heavily in the development of our newer partners. We manage firm transitions with integrity, because we understand that how we treat our own team is a direct reflection of how we will treat the entrepreneurs we back.
There are only 5 publicly traded tech companies created since 2004 that are currently worth more than $10 billion; Greylock invested in four of them, and of those, two were incubated at Greylock. Our partner companies have made more than 170 public offerings and more than 120 of our companies have achieved profitable M&A events. So we may be the “nice ones”, but we are the nice ones who help build enduring technology companies and have been doing so successfully for the past 50 years.
The entrepreneurs who choose to work with Greylock do so because they share these values. If, as an entrepreneur, you’d see us as just a funding option, then there are a lot of places that you should be other than Greylock. But if you share our values and perspective on partnership, we’d love to chat.