This post is very much directed at early stage companies in Germany as this is where I'm seeing it the most. Too many entrepreneurs are scared to take decisions. They are too often looking to their VC's to get consensus. I've seen this case both in portfolio companies where we've already invested as well as from targets we are considering for investment.
As a VC, I want to be able to help you wherever I can. I'm happy to give you advice, offer you my network and give you access to anyone who can help you make a qualified decision. At the same time, I am usually too far away from your day to day business to be making the final call on what you end up doing. If you need to let people go to cut costs, it's your decision. If you need to ramp up marketing to generate more sales, it's your decision. If you need to become more international and address other markets, you decide. I can list 20 other things I've encountered but you get my drift. If you clearly tell me the situation, I'll be happy to give you my opinion. At the same time, I do not have enough intimate details at each of my investments to be the ultimate decision maker. Further, I or other VC's involved may simply be wrong. This is for you to decide and argue or execute on. One way or another we shouldn't have an adversarial relationship. I am more than happy to see you as the leader of your company and the ultimate decision maker if it's in the best interest of the company. That's why we invested.
My urge to write this was actually triggered by two target companies who pitched us recently. Both made it clear that they wanted us involved to help them decide where to go. Generally, this is a good thing. I obviously want to give my input and help a company be as successful as they can be. Yet as soon as I see that management needs me as a crutch I get very worried. Strong management teams lead and get things done. Oftentimes they have to act before getting consensus from everyone. Mistakes will be made and wrong decisions taken. Yet, if you're constantly waiting for everyone to agree and give feedback, you're going to really run the risk of hurting your business.
At this point it's totally cliché to say that the management teams which deliver the greatest success are usually the ones who receive the least hands-on time. Yet over and over again this is the case. It's almost scary to see how often the companies which generate the greatest returns receive absolutely the least amount of the VC's attention. It's the teams who know how to get the advice they need where they can find it and then execute on it. The VC is a partner in growing the business and not an authority who has to be kept happy. Keep this in the back of your mind when running your venture backed business and sometimes ask for forgiveness and not permission if you screw up.