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That makes sense. But let's say you have some underlying quality, say intelligence or ambition or determination or "grit". This quality will probably correlate

by edanm 12y ago

That makes sense. But let's say you have some underlying quality, say intelligence or ambition or determination or "grit". This quality will probably correlate with success at both fundraising and building/running a company. Now I don't have anywhere near the experience of YC or even you, but I wold imagine that at least intelligence and determination are positively correlated with both. So I'd expect someone who is good at fundraising to also be good at the rest. There could be a few reasons why this might not be the case. It could be that we're looking at a small subset who have already passed an intelligence/determination threshold, above which these 2 traits matter less, and time spent developing the proper skills matters more. It could be that there are other factors in raising money or building/running companies which matter more, which would be an interesting conclusion to me. Or it could be that I've made an error in reasoning somewhere :)

nostrademons 12y ago
Let's say that having high intelligence makes you 5% more effective per standard deviation at everything you do, but deliberate practice makes you 10% more effective per week at whatever you practice. Now take two founders, one of whom is twice as effective at fundraising as the other. There are a couple possibilities: maybe he spent 7 weeks more time practicing fundraising than the other, or maybe he spent 6 weeks more and is 2 standard deviations more intelligent. If he spent 7 weeks more time practicing, then the other founder who devoted that to, say, customer development will know the market twice as well. But even if he spent 6 weeks practicing and gets a boost from his higher intelligence (equivalent to 1 week of practice), the other person is still 60% more effective at the other stuff. This model is very much simplified, but illustrates a big point that I took a long time to learn: small broad-based improvements take much longer to pay off than targeted, high-% improvements in narrow areas. So yes, being intelligent is nice, it helps slant every skill you learn in your favor. But it is no substitute for actually practicing hard and removing errors. There are similar counterintuitive principles at work in many other areas. I've found that engineering tools or frameworks that promise a few percent improvement in productivity are rarely worth learning and almost never worth developing unless they have a huge userbase, because it may take you 2 months to develop them but if they save you 5% in development time it'll take 40 months to break even, by which time they're probably not applicable anymore. Similarly, you are almost always better off hiring the person with little experience who is really passionate about your company, rather than the guy who is seemingly a genius at everything he does but really doesn't care about you or what you do. It's probably also behind the YC advice to be "narrow and deep" when building for customers; you can improve the product much more quickly when directly targeting a small userbase than when trying to please a large one.
wpietri 12y ago
Some underlying qualities correlate positively with success in both. Some correlate negatively. Charm, for example, or salesmanship. My late grandfather was a master salesman. People would believe what he said, because he himself believed it when he said it. He was also amazingly good at knowing what people wanted to hear. What he wasn't so good at were trivial things like "facts" and "truth": those things often got in the way of believing the most useful thing at the moment. Several times I've had pals at software companies where the CEO has great sales skills. Every time it's gone great at the beginning, because they get plenty of initial customers. But then things get ugly, because the CEO's promises aren't constrained by the realities of software development. It's death by a thousand cuts as tech debt mounts. Or key customers leave because the CEO consistently promises things that can't be delivered. Or some other ending where ugly reality eventually intrudes upon the CEO's beautiful vision. I'm sure some people are great at raising money because they're great at building companies. But I'm equally sure that some people are great at raising money because they're terrible at running companies.

by edanm 12y ago

nostrademons 12y ago

Let's say that having high intelligence makes you 5% more effective per standard deviation at everything you do, but deliberate practice makes you 10% more effective per week at whatever you practice. Now take two founders, one of whom is twice as effective at fundraising as the other. There are a couple possibilities: maybe he spent 7 weeks more time practicing fundraising than the other, or maybe he spent 6 weeks more and is 2 standard deviations more intelligent. If he spent 7 weeks more time practicing, then the other founder who devoted that to, say, customer development will know the market twice as well. But even if he spent 6 weeks practicing and gets a boost from his higher intelligence (equivalent to 1 week of practice), the other person is still 60% more effective at the other stuff. This model is very much simplified, but illustrates a big point that I took a long time to learn: small broad-based improvements take much longer to pay off than targeted, high-% improvements in narrow areas. So yes, being intelligent is nice, it helps slant every skill you learn in your favor. But it is no substitute for actually practicing hard and removing errors. There are similar counterintuitive principles at work in many other areas. I've found that engineering tools or frameworks that promise a few percent improvement in productivity are rarely worth learning and almost never worth developing unless they have a huge userbase, because it may take you 2 months to develop them but if they save you 5% in development time it'll take 40 months to break even, by which time they're probably not applicable anymore. Similarly, you are almost always better off hiring the person with little experience who is really passionate about your company, rather than the guy who is seemingly a genius at everything he does but really doesn't care about you or what you do. It's probably also behind the YC advice to be "narrow and deep" when building for customers; you can improve the product much more quickly when directly targeting a small userbase than when trying to please a large one.

wpietri 12y ago

Some underlying qualities correlate positively with success in both. Some correlate negatively. Charm, for example, or salesmanship. My late grandfather was a master salesman. People would believe what he said, because he himself believed it when he said it. He was also amazingly good at knowing what people wanted to hear. What he wasn't so good at were trivial things like "facts" and "truth": those things often got in the way of believing the most useful thing at the moment. Several times I've had pals at software companies where the CEO has great sales skills. Every time it's gone great at the beginning, because they get plenty of initial customers. But then things get ugly, because the CEO's promises aren't constrained by the realities of software development. It's death by a thousand cuts as tech debt mounts. Or key customers leave because the CEO consistently promises things that can't be delivered. Or some other ending where ugly reality eventually intrudes upon the CEO's beautiful vision. I'm sure some people are great at raising money because they're great at building companies. But I'm equally sure that some people are great at raising money because they're terrible at running companies.