The analysis of VCs shows that top-performing investors are well positioned in three areas: experience, aspiration and external resources. To understand how VCs and their portfolio companies discuss the importance of various parameters for success a sample of firms were interviewed and each interview was coded for content by checking if the interviewee mentioned a particular issue as important. For example, within the experience category, it was counted how often the interviewee mentioned their entrepreneurial, industry and investment experience as a contributor to a successful exit. If an interviewee mentioned all three forms of experience then they received a score of three.
As the table shows, the top performers were stronger across the board on the issues that they mentioned were important in creating successful exits. It was found that top-quartile venture capitalists were particularly strong in their experience and their external resources compared to other venture capitalists. Both experience and external resources accumulate over time, which mirrors the fact that the top-performing VCs are all in an older age group, about 15 years, compared to the other VCs. The negative numbers for bottom-quartile venture capitalists indicate that they mentioned negative attributes such as a lack of industry-specific experience.
Interesting to note from the research that with venture quantity does not necessarily mean quality and in fact the VC with the most exits (11 – exclusively in venture) and one of the highest number of active investments (38) does not mean they are exclusively ranked in the top quartile, but actually fall in the median quartile.