The Rise of the Buddy VC

Even Bain Capital Ventures is getting more hands-on.

heitzmann The Rise of the Buddy VC

Mr. Heitzmann.

These days, venture capitalists do so much more than write checks; in fact, it’s starting to seem like some VCs will do everything short of give their portfolio companies backrubs. Investors—many of them former or current entrepreneurs themselves—host dinners, make introductions, sit on boards, and gently or not-so-gently nudge startups in one direction or another. It’s the buddy VC—business mentor, recruiter, shoulder to cry on, never more than an email away.

A story in Crain’s sums up the buddy VC phenom nicely: “More than financiers, they are mentors, rabbis and consiglieres, all wrapped up in one.”

Investor Fred Wilson worked hand-in-hand with William Mougayar from idea to funding to launch Engagio. Paul Graham, David Tisch and Dave McClure take a deep interest in advising their startups; investors can also provide drive-by counseling as mentors to those incubators. Bijan Sabet regularly sends his companies feature requests (“The key to our many successes is our desire to take an active role in the companies we back,” says Spark Capital.) And of course, you gotta just trust Kenny Lerer.

“When potential investors look at you, what do they see? An entrepreneur?” says FirstMark Capital. “At FirstMark Capital, we see more than that. We see a leader and an innovator. We see the potential you see in yourself. We see an opportunity to turn your ambition into brilliance. The way we see it, we’re doing more than investing. We’re creating the next big name in emerging technology: yours.”

As FirstMark’s managing director Rick Heitzmann put it, “We’re in an entrepreneurial service business.” And they blog.


  1. Bill N says:

    Sorry, what was that about Dave McClure? He admits he couldn’t even name many of the companies in his portfolio as a consequence of having so many investments. He certainly does not take a deep interest or in some cases any interest in advising his portfolio companies.

    1. on the contrary, we have a very good relationship with our founders and their teams, especially those that live with us for 4-6 months at our incubator. while individually I may not spend as much time with each founder, our team of 10 people and our mentor network of 175 people around the world DO spend time with our companies.

      1. Anonymous says:

        Impressed at how early Dave McClure gets up! Isn’t it before 5 am over there?

      2. brianstorms says:

         Somebody dis 500 startups, Dave is THERE, instantly sensing a disturbance in the force, and responding with lightsaber drawn!