Because the most recent class topic is “Innovation and Entrepreneurship”, I felt it fitting to introduce Mark Suster’s blog: Both Sides of the Table. A two-time entrepreneur and venture capitalist (VC) based in Los Angeles, Suster gave me an understandable, witty, and concise introduction to the world of entrepreneurship and venture capitalism, using his personal experiences to bring the reader to the perspectives of both investor and innovator – hence, “both sides of the table”.
Mark Suster: entrepreneur, angel investor, writer. Image by GRP Partners via CrunchBase
In one post, Suster criticizes journalists who condemn companies as unprofitable and discusses why startups must care more for growth than revenue. Suster uses accounting, financial, and strategic arguments to explain how VCs disregard companies who, though graced with giant gross profit margins, lack very little vision for long-term growth and therefore hold little lifelong value.
The concept is interesting for me because it shows me how so many problems in business are caused by thinking too much in the short-term. Public firms commit financial fraud because they feel trapped by the need to appear strong in the short-term for shareholders. Transient advantage is lost by companies who do not plan ahead and opportunity costs rise when businessmen don’t prepare a framework to take advantage of shifting markets. For me, this is a reminder that businesses must remain fixed to their goals and values for the long-term. Andrew Mason from Groupon seemed aware of this fact as he argues that “going public” confines an entrepreneur to pleasing shareholders and slugging through the short-term.
It really helps to look at professional blogs when seeking inspiration. Suster’s casual yet engaging tone speaks to my heart as a model to consider. What’s also interesting is that my understanding of articles found in business blogs has improved tremendously thanks to the toolkit I’ve been building in this course (i.e. Suster says “a dollar next year is worth less than a dollar today”, which I wouldn’t have understood if I didn’t learn the time value of money).