Jeff Clavier
Last week, I got the chance to sit down and chat with Jeff Clavier, founder and managing partner of SoftTech VC (some of their representative exits include Mint and Tapulous). Before diving in, I want to give a shoutout to Lionel Vital for being totally awesome and setting this meeting up! So Jeff ran us through his background and told us the story of how SoftTech VC was founded, then opened the floor to questions. In the ensuing discussions, Jeff summarized three rules that he has found to be governing pillars for entrepreneurs and venture capitalists alike. The 3 Ds, the 3 Asses, and the Life Is Too Short Rule.

The 3 Ds: Design, Development, Distribution
The 3 Ds rule has to do with the core business processes of web 2.0 entrepreneurship. Design, development, and distribution (the 3 Ds) are the three elements that Jeff believes make up the foundation of web 2.0 startups and thus the core of the perfect web 2.0 startup team. Design refers to product design, development to software development, and distribution to, well, distribution of the product into consumer hands. Jeff also says that three is a good size for the founding team: one is too lonely, two is okay, but three allows for great specialization. However, these three elements do not necessarily have to be divided into three founders; sometimes, one founder possesses all three. The important thing is to make sure that a web 2.0 startup team has strong competencies in each of the areas.

The 3 Asses: Smart-Ass Team, Kick-Ass Product, Big-Ass Market
The 3 Asses rule is Jeff’s summary of how he evaluates startups. The ideal investment is a company with a smart-ass team, kick-ass product, and big-ass market. In addition, the ‘smart-ass team’ part is by far the most important. However, the evaluation process is never as simple as sitting in on a pitch and checking off 3 boxes. Jeff admits that it’s oftentimes more art than science, and that the best way to think of it is through a scale analogy: every positive factor weighs in on the scale until a tipping point is reached and investing begins to feel right. Something along the lines of ‘do this for long enough and you’ll know it when you see it’. The 3 Asses rule helps highlight specific factors that weigh in more than others, and once again, the smart-ass team is the number one most important factor by far.

The ‘Life is too short’ Rule
This one blows me away with its omnipresence. So many entrepreneurs and VCs I’ve chatted with this past summer have brought up this rule in one form or another. The rule is pretty literal: when considering an action, remember that life is short. With this in mind, decide on what you want to do. A common extension of this rule is ‘Life is too short to work with assholes’; for Jeff, it is “Life is too short to invest in assholes.” He stressed the importance of this rule and that despite its nebulous nature, it comes into play quite often. Many times, the question of “do I want to spend 5 years of my life working with these guys” trumps the question of whether the investment will make financial returns. Jeff emphasized that despite the possibility of asshole teams generating incredible returns for investors, he has never regretted turning down a deal on the basis of the ‘life is too short’ rule.

The chat with Jeff Clavier was an awesome close to an unforgettable summer. I will be missing California/startup/TEC life. Thank you True for an incredible 3 months!