The more time I spend around people who are really good at what they do, the more I notice that they make it sound simple.
Not easy.
Simple.
They've got three or four things they actually believe and they just do those things over and over.
The people who struggle are the ones who overcomplicate it. They lose focus, they get distracted by process, they build systems to protect themselves from being wrong, or they focus on the wrong customer.
I hosted David Tisch of BoxGroup at our VC Best Practice lunch with Stifel Bank and KPMG this week.
His entire view of venture fits on an index card:
Investors invest.
Back the smartest people possible.
Be optimistic.
Treat founder requests with urgency.
That's it. That's the whole thing.
Everything else he said over the next hour and a half was either one of those four rules applied to a specific situation, or a description of something most firms do that he threw out because it got in the way of one of them.
He didn't even claim to have come up with the first two. When he started, he said there were four people he listened to the most: Fred Wilson, Ron Conway, Josh Kopelman and Brad Feld. Brad's line was "investors invest," which sounds like nothing until you remember what 2010 looked like. There were a lot of people calling themselves angels and advisors who took meeting after meeting and never wrote a check. He called them succubuses of time. If you like something, invest. The other one from Brad was "invest in people," which is also obvious, except that when you're new you "over-rotate to ideas, because ideas are the easiest thing to grab onto", as David put it, and you don't have the reps yet to read a founder.
The reps are the part I think people miss. David got his eye the old fashioned way, which is that he met everyone. He spent 2007 to 2009 running a skunkworks inside KGB, the 411 company, which was printing cash while the rest of the economy fell apart, so they could hire anybody. He said that by the time the New York ecosystem got going in 2010, he'd already interviewed something like half of its future founders at that job. Then he ran three Techstars programs in New York and personally reviewed all 5,500 applications and did every first-round interview himself. Most of them were awful, which was the point. When you see that many, the smart ones stand out on their own.
This next part is mine, not his. Ten or fifteen years ago, the average startup was pretty terrible, and the good ones stood out because the bar was on the floor. New Yorkers didn't know how to build startups are because we weren't a multi-generational startup ecosystem like the Bay.
Now the average startup looks much more competent. Founder best practices are table stakes. There are startup factories everywhere, schools and accelerators and a thousand podcasts teaching people how to act like a founder, so everyone kind of seems like they know what they're doing. That makes the eye harder to develop, because the filter can't be "can they do the job" anymore.
Everyone can do the job. A lot of them still treat it like a job.
Which is why his rule says the smartest people, not the most prepared. He was blunt that the archetype he won't fund anymore is the capable one. Good founder, will hire, will build, will sell the company for $30 million apiece and go be a senior PM somewhere and be perfectly happy.
He'd rather fund a binary implosion. His words.
The founders he backs now walk out of a meeting and his team says, we have to give that person money, they're just so good.
Too many VCs are writing checks to people that they can't say, "I'd be an idiot for letting that person walk out the door, no matter what the idea is."
That should be the bar and everything else, for the most part, gets thrown out.
BoxGroup doesn't write memos. Nobody votes. There's no ownership target and no minimum check size. There's no "diligence process" that takes weeks--unless someone has firsthand knowledge about the founder that needs to be brought up.
Every one of those is something an LP would call a red flag, and every one of them got cut for the same reason. Does this help us invest in the best founders possible? If not, it's a blocker.
Take ownership targets. His argument was that if your floor is 10%, you've decided to invest in Sequoia's rejects, because the founder who has Sequoia on the table isn't giving you 10%. He was pretty direct with the table about this. You can't beat Sequoia, the same way you can't beat LeBron at basketball, and a founder with top tier brain should never pick you over them. So don't fight them. Get in before the process, or alongside it, with a check that doesn't compromise the founder's ability to go run that process. An ownership target is a blocker. It screens out the best founders before you ever meet them.
Basically, if they're picking you over Sequoia, they're not the smartest founders.
Memos are the same story. His take is that a memo at seed exists to explain why something won't work, either as a defense mechanism or as a case for getting promoted. The problem is that the explanation for why a company won't work looks exactly the same whether the company fails or succeeds. Anyone can do it. He said name any company you've funded and he can tell you why it won't work. That's not the job. The job is figuring out how it could.
Optimism is built into how the firm actually runs. BoxGroup has two funds. The seed fund's job is to say yes and the opportunity fund's job is to say no, and they run completely different conversations. In the seed discussions, nobody is allowed to be negative about a company unless they met the team or have a real reference. They call it "no grenades." He goes into every one of the forty meetings he takes per investment wanting to say yes. It's the founder's to lose.
The Etched story is the same rule under a different name. He passed on them in 2023, because the idea of two eighteen year olds at Harvard building a chip company sounded impossible, and it wasn't. The lesson his firm took from it was suspend your disbelief, which is just optimism applied to things that haven't happened yet.
He earned the right to be that optimistic by being honest about how bad everyone is at this. David says they fail on about 70% of early stage investments, and so does everyone else. You're in the business of failure. He doesn't think he's a better picker today than he was ten years ago, because he's still wrong seventy percent of the time. He thinks he sees better things. He also said that if he'd said yes to every single company he met during his first fund, the returns would have been ten times what they were. I can attest to this same thing. Over my career, if I just gave a blank check to everyone who made it to my inbox where I actually exchanged even an e-mail with the founders, I'd be an investor in Datadog, Wise, Plaid and Huggingface.
"We see amazing things and we were picking mediocrely."
The last rule is the one nobody puts on their website. Founders run on pure urgency, every day, all year. The investor's job has none. So if he doesn't meet the founder where they are, he lets them down. BoxGroup promises nothing except response time. Not that they'll build your company for you, which is what every other firm promises and doesn't deliver. The promise is, we will try very hard to do the things you ask us to do, very quickly. Sometimes the fast answer is I don't know, or I can't. It's still an answer. He said the thing that kills his NPS is when a founder decided something was important enough to ask their investor and then had to wait forty-eight hours for a reply. Soul crushing, was the phrase.
I want to acknowledge one thing about David, because it's the reason that last rule always struck me. He started BoxGroup with his own money, and it ran on personal capital for years before it ever took an outside LP. That's the benefit of being part of a successful family, and, yes, it's an enormous head start.
The reputation David built in this city, however, wasn't for having money. It was for being the guy answering founder emails late at night, for years, when he didn't have to. When someone doesn't need to work harder than everyone else and still does, watch out.
He credits the work ethic to a tough high school hockey coach, a former mechanic from Saugus, Massachusetts coaching rich kids in Scarsdale, who taught him the only thing in a career you fully control is input. Sports is often the great equalizer that way. Resources can only take you so far, and you can always get outworked by the next person who wants it more.
That's the index card. Invest. Invest in the smartest people you can find. Assume it could work. Answer the email.
I'll add one thing he said that is going to stick with me. The gatekept industries are now open. He's seeing chips, nuclear, brain-computer interfaces, printed circuit boards, defense companies run by twenty year olds building submarines and missiles. Ten years ago those weren't startups, they were government programs.
The barriers to entry are gone.
So are the moats, and the odds of success haven't gone up at all. It doesn't change the four rules. It just means suspend your disbelief now covers a lot more ground than it used to.