insights by tech leaders on design in venture capital

1. How does a design perspective help in evaluating an investment decision, in obvious ways?
Like trained mycologists who know the difference between highly prized edible mushrooms and the ones that will kill you, designers are particularly adept at identifying mechanisms for adoption and retention that might help predict the potential for a company’s growth, as well as the subtle signs that something might be initially delicious but ultimately fatal.

2. How does a design perspective help in evaluating an investment decision, in non-obvious ways?
Surprisingly, a good sales pitch is a lot like a good user experience—there is an initial moment, a journey, a crux, and the requirement of both immediate and enduring value. Designers can help spot the potential for a product’s ability to attract customers, even if the current sales pitch is underdeveloped.

3. Where have you seen a designer’s perspective possibly harmful in the investment process?
Designers strive to free of biases, while still having a voice and a strong point of view—but that’s a goal, and often remains frustratingly out of reach. Designers, or anyone for that matter, must constantly be mindful of their own biases to make sure they don’t transfer product insights, customer research, or their own life experience from one market and assume it applies to another. And yet—deftly applying these insights is the essence of innovation. So we try and fail, but sometimes try and then thrillingly win.

4. What are three characteristics in a company’s structure/history that will likely lead to success in leveraging design?
Here’s my point of view, it is not a consensus from the entire industry, but my personal take. Design will provide the most value at a company if the design leadership reports directly to the CEO—not to the head of product, or the COO, but the CEO. If design is instead relegated to being a service org with internal customers, such as the head of product or the head of sales, then you will likely get merely competent results from the team instead of exceptional results—why? because the designers will be busy doing what they were told instead of figuring out what needs to be done.

5. How do you best support CEOs with a purely technical and/or business background to leverage design in their startup?
Purely technical founders are gifted at imagining a theoretical machine—like an math function from high school calculus or a sorting algorithm from their first product—savvy designers exploit this gift to present their work to the CEO also as a type of machine—one that generates revenue, retains users, reduces churn, augments adoption, or whatever other problem the designer is trying to solve. With both the technical CEO and the designer using the same metaphor and telling the same story, it becomes easier to iterate, improve and measure success. If I have a role in this process, it’s to help align their shared story.

6. What are a few challenges you’ve seen in working with companies that have caught “the design bug” -- especially the CEO?
If a company that previously had a limited focus on design suddenly wants to turn it’s attention to design, the first challenge is to help the company understand what design can do—the role design can play in retaining users, converting sales, reducing load times or friction-filled experiences, raising revenue, etc. To get there, a valuable exercise is to guide the leadership team through the process of crafting a job description that might successfully attract the right kind of design leader. This seemingly innocuous exercise is healthy because it will force the leadership team to have tough conversations (sometimes gut-wrenchingly tough) about where the design org will sit within the company and what expectations, responsibilities, and charter it will have.

7. Which public companies out there do you admire for their approach to design?
- Apple
- Nike
- Tesla

8. Which startups in the CONSUMER space do you think embody design in their companies particularly well, and why?
- Airbnb
- Instagram
- Medium

9. Which three startups in the ENTERPRISE space do you think embody design in their companies particularly well, and why?
- Square
- Inkling
- Plangrid

10. What are a few URLs of your favorite writings on design in the VC space (including your own)?
- The GV library on design
- Design in Tech Report
- Design Story on Medium
- Irene Au
- Build from Sequoia
- First Round's Design Magazine
Additional URLs
- 52 weeks of US
- The Year of the Looking Glass
- Fast Company Design

Made in 2016 by John Maeda