A company in our portfolio has created a dramatically new way of doing X - which has the potential to change the industry fundamentally while creating a true win-win for everyone in the entire ecosystem. They've hit the ground running with V1 and are seeing 100-day numbers that are unbeatable. 

BUT they are doing something new. Something that has not been done before or thought of before. If they succeed, they will create a new category in a very very large industry. 

As they are raising the next round of capital on strong growth and PMF, it has been surprising to see the pace at which conviction building is happening in the ecosystem and this Whatsapp message encapsulates it all where a brave category-creating founder believes that "most ecosystem partners will be skeptical". 

I grew up as an entrepreneur in the heart of Silicon Valley where such brave category-creating founders are most sought after with conviction - not skepticism. 

So my reply to him was simply this: 

I am hopeful that our ecosystem evolves to embrace such category creator founders. It will. 

Founders face investor rejection all the time. It's part of the game. However, how founders handle this investor rejection is key to their success or failure. 

Investors reject an investment for a wide range of reasons - many of these being more centered around what is right for their fund. Depending on their fund size, number of idea stage bets that have in the current fund, number of late-stage bets they've taken, sectors where they are over-indexed and many such factors go into an investor rejecting a perfectly good company. 

But founders often take rejection too personally. Some spiral into self-doubt and some get turned off by the investor route. Neither of these actually helps the founders at all --- what might go a long way is to take valuable rejection reasons that may go into addressing any gaps they may have, filter the rest and move on without self-doubt or frustration. 

There are far more founders than there are investors and even the most successful founders of our times all faced some level of rejection. 

Startup 1: Built great product. Figuring out the distribution.

Startup 2: Built great distribution. Figuring out the product.

Which one would you go with? And why? 

The purpose of this post is not to find the right answer -- there is no right answer. The purpose is to help founders dwell on this enough to understand what matters most for their segment, stage, and core skillset. 

Having said that, you will notice that you will need to master BOTH eventually to build a large company and just one won't be enough, except for a lucky few :-)