The Intersection of Reading and Running a Micro VC: Insights and Actionable Advice

The Intersection of Reading and Running a Micro VC: Insights and Actionable Advice

Introduction:
Reading, a skill invented 5400 years ago along with writing, has not seen much change since its inception. It remains the most efficient way to absorb information. On the other hand, running a micro VC is a challenging endeavor, with most funds failing to achieve significant returns. In this article, we will explore the commonalities between these two seemingly unrelated topics and provide actionable advice based on insights gained from both.

Reading Techniques:
In his book "How to Read a Book," Mortimer Adler introduces three reading techniques: inspectional reading, analytical reading, and synoptical reading. These techniques can be applied to enhance our reading experience and comprehension. Moreover, the emergence of social reading plugins and the role of Glasp curators as filters highlight the growing trend of social reading.

Running a Micro VC:
Running a micro VC fund requires careful consideration and thorough research. Many aspiring fund managers fail to do enough homework before starting their funds, leading to potential setbacks. It is crucial to have conversations with multiple micro VCs to gain insights into the challenges and realities of the industry. Additionally, being in a solid financial situation is crucial, as the majority of the fund's capital must be used for investing rather than personal expenses.

Advice for Aspiring Fund Managers:

1. Bootstrap with caution: Bootstrapping a micro VC can be financially challenging, with limited income and restrictions on earning money outside of work. It is essential to assess one's financial stability before venturing into this field.

2. Strategic investment: Fund managers typically invest a percentage of the fund size, and capital calls are spread over three years. Understanding the industry's "gold standard" of a 3x return benchmark is crucial for evaluating the fund's success and profitability.

3. Speed of execution: In an industry that is not always a meritocracy, the future of funding should focus on the speed of execution rather than external factors. Emphasizing the ability to execute ideas efficiently can lead to greater success.

Conclusion:
While reading and running a micro VC may initially seem unrelated, they share common themes of continuous learning, careful decision-making, and the pursuit of excellence. By incorporating reading techniques and following the advice provided, aspiring fund managers can navigate the challenges of the industry more effectively. The world of reading and micro VCs continues to evolve, and it is essential to stay adaptive and open to new opportunities.