What ever happened to customer service?
As every market segment gets more competitive, customer service emerges as one type of differentiator. It's why I always go to Starbucks instead of Dunkin' Donuts for coffee (or one of many reasons). I find that I am incredibly loyal to vendors who give me great customer service. Those who delight me with service get me as a customer for life.
My favorite ticket guy, Richie, once blew me away with customer service. I buy concert and sports tickets from Richie. He's not cheap, but he has access to the best seats. A few years ago, during a Yankees-Red Sox playoff series, I was in NY for a Board Meeting and wanted to bring the founder of the company to the baseball game. I had bought tickets from Richie and arranged to have him ship them to the company. Unbelievably, Fed Ex lost the package. Getting the tickets the next day was no good as the game was that night. I called Richie, and he got me tickets to the game couriered to the company. And, he didn't charge me! Needless to say, I am Richie's customer for life. If you ever need tickets, contact me at email@example.com. I'll put you in touch with Richie.
So, why don't VCs give good customer service? I have heard from so many entrepreneurs that VCs are horrible to deal with. They never give straight answers to questions. Entrepreneurs never know where they stand in the decision-making process. Too many VCs like to 'hang around the hoop' in case a deal they are cool on somehow becomes hot. Also, VCs don't treat entrepreneurs well during meetings. They don't pay attention, they read email on their Blackberry's, and they are frequently late. I'm sure you've seen the famous Gary the Snowman holiday video from Blue Run Ventures. Entrepreneurs tell me that this isn't too far from true.
This is a sign of the arrogance and bloat of the current VC business. I always believed in giving entrepreneurs good customer service. I was on time, prepared, and attentive during meetings. I tried to ask good questions, give good, honest feedback, and let them know what the next step in the process was. I said 'No' when I had made up my mind. I received frequent compliments from entrepreneurs who told me how refreshing this was. Huh? I couldn't believe that this was so rare.
VCs who don't treat entrepreneurs well should prepare for a rude awakening. They will eventually not have the best entrepreneurs to choose from. The VC business changes slowly as funds are committed for years. But, I expect some big structural changes in the world of early stage investing in the coming years. As in any business, when it matures, premium providers will differentiate themselves with great customer service.