My name is Spencer Lazar. I am a venture capitalist at General Catalyst. I grew up with the internet, spend my life thinking about how it can make our lives better, and work with world-class entrepreneurs to affect that chanage. NYC is my home. This is my blog.


US vs. EU: Extraverts vs. Introverts

I have now lived in Europe for six months.  It has been an exciting period of intense immersion in which I have met scores of new people in the technology ecosystem and traveled a ton.  Whether with an entrepreneur, investor, or even just a new social acquaintance, I only need speak a word before locals discover that I am a foreigner.  What follows is typically some variation on the same question: how is Europe different from the US?

As this is a big question whose answer is ever-evolving, I thought that I would unpack it by focusing first on one key element of what distinguishes American from European entrepreneurs: a culture of self-promotion.

Self-promotion or salesmanship is one of the most important qualities an entrepreneur can have.  It is the means by which individuals convince others to join a founding team and win any other key hire along the entrepreneurial journey.  It is the positioning used to persuade organizations to trust a fledgling product as an early customer.  It is the push behind a leap of faith required for early stage investors to buy into the dream of a big outcome.  It is a source of creativity required to land both technical and business strategic partnerships - and ultimately exits.  As such, I believe a dearth of self-promotion hampers one's chances of success.

There are a number of structural reasons why self-promotion is somewhat harder to do in Europe.  The first and probably most publicly visible is language.  According to the EU, Europe has 23 working languages.  This inhibits ideation, hiring, and commercialization.  The second is density.  In Europe, everything is just more spread out.  Buildings are typically no more than four or five stories high, leading to sprawl.  And, distance equals effort.  This means teams must work harder to find one another, customers are harder to visit, executives must travel farther to find compelling sources of capital (if at all), and the attention of potential strategic acquirers is more difficult to attract.   

I am not a fan of the complete shameless self-promotion which both Chris Dixon and Chris Sacca recently pointed out as falling out of vogue in America where even the most unlikely of start-ups can find a path toward public visibility.  

I am a believer that people (and particularly entrepreneurs) should be proud of what they are doing & have accomplished and find ways of more frequently (but still appropriately) communicating it to relevant parties.  I would not be in Europe if I did not feel the enormous potential of the region.  

If you are interested, here are a few concrete suggestions:

  • Find ways to close the distance.  Get together more regularly (or even co-locate when appropriate). TechHub in an example of a formal shared space, however, many exist such as OpenCoffee that are less formal tech focused gatherings.
  • Engage with the European branches of some of the larger US tech companies including Google and Facebook, who have now been in Europe for some time, and have strong cultures of innovation (as well as start-ups sprung from within).  They could be your partners, your co-founders, or your acquirers.
  • Embrace social media.  Twitter, Facebook, and even location-based broadcasting services are great ways to get low cost visibility.  Your brand should have a presence that is well curated and actively engaged with your community & customers.

Drop the "E" in Ecommerce

With the recent explosive growth of collective buying sites (such as Groupon), private sale clubs (see Vente-Privee & Gilt Group), and even local artisan aggregators (such as Etsy), the notion of "social commerce" has been all the rage.  Josh Koppelman provides a nice overview of the the gust of innovation in the etailing sector. In March of this year, Fred Wilson called it "Commerce 2.0."  

The fundamental observation that advocates of social commerce make is that people are more likely to buy when their shopping experience requires them to interact in some way with other people.  Whether sharing preferences, inviting others to be a member of your private club, or teaming up to secure a bulk discount through a group deal, the energy and excitement of the herd is deeply powerful.  It is what allows each of us to understand the extent to which purchases make us fit in or stand out. 

While leveraging things like gaming mechanics and the social graph will undoubtedly unlock a meaningful amount of value on the web, I believe that they will only begin to scratch the surface of what is possible.  The reason: most commercial experiences today are optimized around making an entirely asocial experience social. For all that Facebook has done to transform the world over the course of the past few years, there is very little that one could do to make sitting in front of a 15" screen at off-peak hours compare to the energy of being out in the world with your real friends in commercial environments.  Afterall, entire neighborhood communities around the world head to shopping malls just to hang out for the weekend.

The same way that we have seen marketing resources from many of the young and trusted online brands such as Kayak & HomeAway recently shift offline, I believe that we will see a trend in which established and emerging online brands extend their commercial relationship with their customers offline.  When you sign up to be a member of a online shopping club, it is not enough for that brand to simply send you a daily email with relevant content and purchasing opportunities - just as in paying for a membership at an offline private gym, I expect more from the institution than simply providing me competitively priced access to a treadmill.  Such companies are first and foremost undifferentiated and if successful, highly prone to copycat behavior.  But more importantly, they are not leveraging the most important thing that a direct to consumer brand has with its customers: trust.  

The brands that I love and choose to transact with online should leverage what they know of me to extend their influence offline.  Offer your community access to the world that you claim to represent.  In person trunk shows are a start, but think out of the box a little - invite a few of your members to actual real life fashion shows.  If you are a food site, allow members access to special drinks on the menu of a handful of restaurants. If you are music site, get me VIP access to the concerts of the bands that I love.

Product-based online commerce is a rapidly commoditizing industry. To differentiate, retailers must drop the "e" in ecommerce and extend their relationships with their customers into real offline social but transactional settings which still resonate with their online brands.



Curated Optimism: The Things We Think, But Do Not Say

A couple days ago, Jon Steinberg wrote a blog post entitled "Acquaintances" wherein he calls attention to the growing semantic trend in which some individuals opportunistically refer to others with whom they have tenuous social connections as "good friends."  His frustration is one I share.  

People portray an overly optimistic representation of their import or relevance to individuals, organizations, and experiences to advance their own social or commercial agenda.  This is particularly true of junior people in an industry.  Without a tremendous amount of history and hard-earned reputation to work off of, people adopt this behavior as a means of bridging their experiential divide - particularly when interacting with relatively more successful people (either entrepreneurs or investors).  I try to avoid it, but every once in a while fall into this trap.  My apologies if I ever come off this way.

His post, however, got me thinking about another form of disingenuous behavior which has infected the business and tech worlds: curated optimism - or as Jerry Macguire called it, "The Things We Think But Do Not Say."  

It is the phenomenon whereby business professionals (and often times investors) disproportionately represent positive experiences with people, products, and businesses over their very choppy reality.  We see this a lot in the social media ecosystem - the most accessible way of publicly communicating and branding oneself these days.

My problem is not with what is said (things like "congratulations @blank"...or "loving @blank"...or "can't wait for @blank"), but with what isn't.  So rarely do you see a person at any level of seniority express frustration via twitter, blogs, or other online channels with anything.  The whole concept of customer service, for example, exists for corporations to respond to the reality that patrons are often times left unsatisfied.  This is true of relationships beyond those of person/product or person/service.

This behavior is rooted in one of the first principles of business - the preservation of option value.  From the entrepreneur's perspective, expressing frustration or dissatisfaction could some day (a) hurt their ability to make a key hire; (b) limit their chances at scoring a desired investor; or (c) piss off a potential acquirer.  From an investor's perspective, saying something negative could result in (a) a soured relationship with a portfolio company; (b) a pissed off LP; or (c) an increased perception among entrepreneurs that the GP is a bully, tough to work with, or worse - unapproachable.  

This is a hard behavioral attribute to systemically change because of how firmly ingrained it is in each constituency of the business community.  But just as Jon is frustrated with people who disingenuously elevate their stature via their social network, I am put off by people who suggest that all people, products, services, and companies are fantastic.  The absence of negativity is dishonest.  Bad experiences happen to all of us.  It would be nice if more people presented themselves as such. There are a few that do and they are remarkably more trustworthy.


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