A Mobile Knowledge Gap Facing Many Investors

Many founders want their investors to be former founders, which makes sense since the journey is a lonely grind. Many founders want to work with investors who posses deep operating experience, which makes sense because those with experience scaling companies could offer tremendous value as a new company starts to grow. And, some founders want their investors to have relevance in their space, whether that means deeply technical investors, or investors who have deep experience with online marketplaces or network effect businesses, and so on.

Of course, these days, investors market themselves to no end given the sheer amount of venture capital and angel money floating around, each of them taking a slightly different tack to highlight their strengths. It makes sense and, given some of the folks making new digs on Sand Hill, it’s totally justified because the new crop of investors is extremely talented on all levels operational, technical, and so beyond.

But, what about mobile experience?

Specifically, I mean, what about newer phones and tablets? This covers both the cell data infrastructure, the data stack for mobile, cloud-based operational models, mobile operating systems themselves, the various sensors on the phones, the software stack used to build on top of the OS, and design and product? And, not to mention, in the wake of Pandora announcing it rakes in about one-third the revenues on mobile vs. web, what are the various business model implications of mobile?

For many years, many investors had all sorts of relevant “Internet startup” experience to share with new founders building “Internet startups.” Today, traffic and attention has shifted away from the web (though the web is very important and the key to virality in many cases). To be sure, there are a handful of investors who have deep experience in different aspects of mobile, and by many different means. Rob Hayes of First Round worked for MSO’s before going into venture. John Lilly of Greylock worked at Apple years ago, understands all the device sensors and their interoperability, and actively digs into Android by using both platforms. Or Mike Abbott from Kleiner who helped architect webOS at Palm. Then there are investors who have accumulated incredible depth and networks in mobile rather quickly through their investments, such as Matt Cohler or Fred Wilson. (I’m missing many others, but just trying to make a general point.)

While it remains debatable whether companies should be thinking “mobile first,” mobile is obviously a major part of any overall platform strategy, especially around user engagement. And, for newer companies starting out that have significant mobile plans, founders may or may not be in a position to receive relevant guidance from their investors given how new and fast-moving mobile device adoption continues to grow. Of course, all of the building, distribution, and marketing is left to the entrepreneurs and the companies, but I believe founders should keep this paradox in mind as they consider their future investing partners.

Haywire is written by Semil Shah, and is published under a Creative Commons BY-NC-SA license. Copyright © 2014 Semil Shah.

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