Do "Operators" Make The Best VCs?
I often hear that the best VCs are those who once sat on the other side of the table -- investors who "get it" because they were once "in it." On the other hand, that argument is usually coming from VC firms who just hired one of those ex-operators, or from an entrepreneur who just took funding from one. So a simple question: Do ex-operators make the best venture capitalists? To get an answer, I pulled out the latest edition of Forbes' Midas List, which is supposed to rank the most successful venture capitalists. We can certainly quibble about Forbes' inclusion methodology and individual results (the older skew, for example), but hopefully can agree that the overall list is a good sample of quality investors. Next to each of the 100 Midas Listers, I put one of three classifications that best described the individual's career prior to venture capital. They were: "C" for C-level executive, "O" for lower-tier operators and "X" for those without, or virtually without, formal operating experience (ex-bankers, consultants, career VCs, etc.).
