Trinity Ventures Gus Tai: Believe in an idea; you're never as good or bad as you think you are
In this segment of Lessons Learned, Bambi Francisco interviews Gus Tai, general partner at Trinity Ventures. Among some of the investments Tai is an active investor in are Wetpaint and mSpot. Tai also invested in Photobucket, which was sold to Fox Interactive Media in 2007. Prior to Trinity Ventures, Tai began his operational career in engineering management at Digital Equipment.
BF: Give me three pieces of advice for the entrepreneurs on Vator.
GT: I think first and foremost, it's really important to keep repeating the message of why what you do matters. You need to repeat it frequently to everyone, your customers, your audience, and to your employees. Often at times, it's easy to think that it's obvious, but by repeating it, you get people to understand and believe what you are up to. The second item is that when you talk about early stage companies, be very careful how you hire your first five or six people. Every addition you make really shifts the company culture. And getting the culture right is what's most important when you talk about formation up until to ten, twenty, thirty, or forty people. And the third item I would say, particularly relevant for this climate, is both you're never as good as you think you are and you're never as bad as you think you are.So when things are going great, it's always helpful to have a bit of humility. But in tough times right now, realize that things are going better and you are better than what you might believe in any given moment.
BF: I like that. So just to be more specific, can you talk about a failure that you had as an investor in a portfolio company and what happened there?
GT: One of the companies I thought most highly of and ultimately it failed, was a company called Imotors. Imotors delivered the proposition that can figure out the used car that you want online and could deliver it to you within 30 days, money back guaranteed. It turned out that a lot of people were fearful that consumers wouldn't be trustworthy. And that is absolutely not just the case. People will buy the auto and then speculate properly. That's the same reason with buying diamonds online as well. You can't trust consumers. But where we made a mistake and where I felt like I learned a lot from making a big error was that we over-expanding that business model. So the company got up to well over $100 million dollars in revenue run rate and it was profitable in certain parts of the country. But in the bubble, we focused on trying to have a national footprint and build beyond the capacity of what we felt the company needed at that point. So that all goes back to crawl, walk, run. Figure out what works and gradually expand and don't go too fast.
BF: I like that. Crawl, walk, run.
GT: Yes, so maybe that's the fourth lesson for the entrepreneur.
BF: The fourth lesson is a great lesson, Gus. Thanks very much.
