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May 01, 2006

How to spot a good VC

Entrepreneur & CEO Matt Blumberg has list of characteristics that a great VC needs to exhibit.
- Major pattern recognition -- "I've seen this movie before, and I know how it ends...";
- Deep understanding of the market and/or customer set to add strategic value;
- Fundamental desire to be a product manager or marketing manager of your product, but also --
- Ability to stay out of the weeds with day-to-day details when the Board meeting ends;
- Complete transparency about the motives of his/her fellow GPs and LPs and ability/appetite for follow-on financings (and needless to say, no/limited blocking of transactions that are clearly in the company's best interests but might run counter to his/her firm's own short-term interests)

Arun Natarajan is the Founder of Venture Intelligence India, which tracks venture capital activity in India and Indian-founded companies worldwide. View sample issues of Venture Intelligence India newsletters and reports.