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Venture Capital Then and Now with Legendary Investors, Bill Draper & Pitch Johnson

Episode 359
What do the world’s best venture capitalists look for in an entrepreneur? Bill and Pitch share their experience.

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Chad and Ian are joined by Bill Draper and Pitch Johnson, both of whom were instrumental in starting venture capital in the early 1960’s, shaping the industry even to this day. Bill and Pitch first met at Inland Steel in the late 1950s, instantly becoming friends and forming a lifelong personal and professional relationship. Both Bill and Pitch decided to leave the steel mill to form Draper and Johnson Investment Group which would later became Sutter Hill Ventures. Pitch went on to start Asset Management Group in 1965 and it is still in operation today. Both Bill and Pitch have incredible track records for success in investing in the right entrepreneurs at the right time and advising them along the way. 

On this episode of Mission Daily, Bill and Pitch share their background, what it was like breaking into venture capital, and how the industry has changed over the years. 

Quotes from Bill:

“Both Pitch and I know that the most important thing you can do when starting up a new business is to get to know the entrepreneur that’s going to lead the team. Will he carry through when the going gets tough? Are you going to be able to communicate well with him? Is he a team player? Is he likely to be able to attract other good people around him?”

“The job as a venture capitalist is not to run the company. Your job is much more of a supportive role and that is crucial in some cases but in other cases, it doesn’t even matter such as with Steve Jobs.”

“Be sure you thank people as you go along [your career] for what they have done for you.”

“You want to have a vision of the long term and with that you also need the ability to meet your opportunities and take the risks that are important to get to that long term vision. But don’t concentrate too much on having to get to that big exciting future before you take one step at a time.”

Quotes from Pitch:

“I always say that one of the great pieces of advice that I ever had in my life is to get to know the people you are going to work with in an organization and then work with them. I try to get to know people a lot before working with them.”

“I’d say market-oriented vision, good knowledge of technology, and the ability to get a bunch of people together to work together [is needed today.]”

“One thing that was true then, people thought ‘if we build a big company, a good company then we can make some money.’ But the ‘build a good company’ came first in their minds.  Nowadays I think people often focus on making money and not on what they’re doing.” 

Mentions:

The Marshall Plan 

Stanford University 

Draper, Gaither and Anderson 

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