Fact-based decision-making

A key OpenView Venture Partners value is fact-based decision-making. We bring this to the venture capital investment decisions we make and to the operational support we provide to our portfolio companies.

We also try to have impact by guiding the senior management teams of our portfolio companies to apply fact-based decision-making to their businesses. As Steve Blank blogged last summer, as start-ups grow, they need to make a transition from “faith-based” to “fact-based” decision making.

We have all been in too many meetings where a decision is debated using opinions, hunches, and implicit assumptions, some verified by a person experience, others by nothing more than impressions and perceptions, and others still by theory.

Identifying the key issue of a decision, understanding what data is needed to resolve that issue, and getting that data is key to making better decisions more quickly.

If the data is not available, or getting will take too much effort, the importance of the data needs to be weighted against the impact of the decision.

I can relate one example from a few years ago when we were helping re-organize an expansion stage software company’s sales team.

An approach was on the table that would orient the team very well around pursuing smaller opportunities, but had some blind spots for managing large enterprise deals, and I kept voicing my concern about those blind spots.

Finally, Scott asked the COO: “How many big enterprise deals do you have coming in right now?”, and the COO responded, “Maybe 2-3 a quarter max”. Case closed. Those blind spots weren’t very important for the company’s current business.

I was relying on theory, Scott looked at the facts.