What excites you about the future of venture capital? originally appeared on Quora – the knowledge sharing network where compelling questions are answered by people with unique insights.
Answer by McKenna Walsh, former cat herder at DRM VENTURES, on Quora:
The exciting things about the future of Venture Capital pretty closely tie in with what excites me in the startup world.
We live in an amazing time; things like the phone in your pocket have more computing power than what we used to send a person to the moon. The developments in health care speak for. AR/VR are starting to move from a really neat conceptual idea to actually having the backend engines to process all that amazing big data and create a truly immersive experience. Don’t even get me started on the .
Venture gets to have a sneak peak at all of that. Every single week I get to read or see something that I had no idea was possible. There are more awesome companies than ever working to solve really big cool problems. That fact opens up some of the most exciting and frustrating things about the future of VC.
1) Finding the needle: With the explosion of entrepreneurs and societies playing fast and loose with the terminology of what being an entrepreneur means, that water is pretty muddy about what is a good fit for venture. This massive flood of people seeking to raise funding creates two problems/opportunities:
- Education: We have some pretty good ideas about what works and what doesn’t, what scales, etc. What we don’t have are great tools to help entrepreneurs other than those people who we directly come into contact with. Additionally to that, right now the burden of being a public resource is placed only on those willing to do it for free. In VC, that’s not a large pool of people who have the skill and bandwidth and are willing to make it a priority. People like are the sliver of a minority.
- Network Effect: That leads directly to the next problem; VC is a one or two degrees of separation game right now. We don’t know what we don’t know and who are the amazing people we are missing. Our networks tend to skew towards our own personal backgrounds and educational experiences, which are leaving a ton of populations un- or under-represented.
2) Doing Good/Big Things: We have some amazing companies and funds with the stated goal of making things better for the world. As the “social good” movement grows and continues to prove out its hypothesis, that people like supporting and doing good things more will follow in their footsteps, leading us to some stunning results in spaces like health, education, banking, and energy.
3) Compressing/streamlining the cycle: The more and more experience that venture gets, the more data we have to learn from about what works. There are powerful tools being created that enable that information to leverage the data to not only make a more informed investment decision but also then follow on with better mentorship and more effective advisory roles.
4) The Active VC: As venture is becoming more and more of a service industry, the shifting in the role of what makes a “great” VC is being refined. No longer is it just about writing a great check, but it is about being of service to your founders. How can you leverage your skills and networks to support entrepreneurs?
5) The people in venture: Here are some amazing voices rising in venture that are coming from a wide background with different points of views that represent a very different breath and depth that we have traditionally seen. From the people making partner at the bigger shops likeand Adrian Fenty, to the up and coming ladies and gents making a name for themselves and their funds like Ryan Smith (Magic Johnson’s fund), , , and (just to name a few) all have points of view and experiences that will empower them to bring a fresh point of view to technology and venture.
Overall, everything that frustrates people about venture is just an opportunity to be solved and get excited about. There are great things ahead for venture and technology.