Beware of Killer Whales
April 29, 2011
I wanted to share a blog with you this week that Brad Svrluga, an early stage VC and co-founder and Managing Director at High Peaks Venture, wrote this April that also ties back to a blog Marc Andreeson wrote on this topic.
The reason I wanted to pass it on is as a venture partner at OpenView Partners where we invest growth capital in expansion stage software companies with great founders, CEOs and management teams, I have witnessed this phenomenon in my discussions with software companies when we are looking at potential venture capital investments.
Recently I have talked to several companies who find themselves in this predicament and it has every potential to hurt them more than help them. They are all looking for ways to manage out of the current circumstances in which they find themselves. They all have interesting products in large markets that solve real business problems… but now they are all trying to figure out how they extricate themselves out of a situation that threatens to damage their futures.
So if you are chasing the whale to
- Create that marketing relationship that will make your company
- Establish that distribution relationship where they will sell your product as a channel
- Build a development relationship where they will help you strategically with advice and funding to build that killer product
- Sell your product to them as your cornerstone customer
Be careful what you wish for. When you chase WhaleCo, as Marc Andreeson calls them, they might take you and your company in a direction you can’t recover from.
All the best!