The Business of Venture Capital, 3rd Edition

16The Venture Firm's Ethos, Culture, and Values

The investment firm Goldman Sachs is considered to be one of the best money-making machines on Wall Street. Yet it was once described as “a great vampire squid wrapped around the face of humanity, relentlessly jamming its blood funnel into anything that smells like money.” Surely, for any investor, success is measured by the returns you generate. And the more you make, the better it is.

But what gives, along this path to riches? What keeps you from turning into a soulless vampire squid? Defining your ethos, and cementing it in your soul, is a foundational step in building the venture firm.

Besides its ethos, values as well as a firm's value proposition can define its brand identity. Many firms believe that a fancy website, smiling faces, and partner headshots with overstated bios and some logos are sufficient. In an era when entrepreneurs have plenty of choices, the venture firms need to weigh the importance of building and branding their venture firms in a compelling fashion.

The archetype of a firm can take several forms — a tight-knit small partnership (Benchmark and the Foundry Group), a service agency (Andreessen Horowitz, with over 100 team members), or a technology-led community platform (First Round Capital). Though each of these models have their own nuances, let's start with the ethos of the firm.

ETHOS

What defines the beliefs, values, and character traits of the firm and its partners? How do they treat people — the ...