What Should a VC Focus On: The Founder or the Business?
Leading VCs debate whether people or ideas matter more—research shows success may depend on both.
One of the most important questions in venture capital is this: Should a VC invest based on the founder (the “jockey”) or the business idea (the “horse”)?
This debate has been around since the early days of venture investing. Some of the most respected early VCs had different views. Tom Perkins of Kleiner Perkins focused on technology. Don Valentine of Sequoia Capital prioritized markets. Arthur Rock of Davis & Rock believed the team was everything.
Today, most VCs lean heavily toward a founder-first approach. In fact, 53% of early-stage VCs say the team is their top consideration, while only 10% point to the business model, and just 6% emphasize market opportunity.
On the surface, this focus makes sense. High-profile founders like Elon Musk and Mark Zuckerberg have shown how much impact a strong founder can make. That’s why many firms now say “venture is a game of jockeys, not horses.” As a result, VCs often chase charismatic founders with impressive backgrounds.
But there’s a problem: research shows this strategy doesn’t always work.
Why Founder-First Can Go Wrong
Studies tracking startups from the beginning through IPO show that the quality of the business—not just the founder—better predicts success. In fact, many VCs make consistently poor decisions by placing too much weight on founder traits.
This often leads to pattern-matching. Instead of digging into the substance of a startup, some investors focus on surface-level qualities like the founder’s education or past jobs. They look for people who remind them of previous success stories, rather than seeking out fresh, unconventional talent.
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What the Best VCs Do Differently
Top investors see the full picture. As Peter Thiel once said, the team, product, strategy, and technology are all linked—it’s never just one or the other.
Nabeel Hyatt of Spark Capital agrees. He says great VCs study the product to understand the people behind it. This approach goes deeper than resume-checking or 10-minute interviews.
That’s also how firms like Y Combinator make fast, smart decisions. Their process focuses not only on the person, but also on the clarity of the idea and its hidden brilliance. Determination and communication skills matter—but they’re part of a larger story.
By evaluating the business and the founder together, VCs get more useful data and reduce the risk of biased thinking. This leads to smarter, more grounded decisions.
The Real Answer: It’s Not One or the Other
Founder-focused investing isn’t wrong—great founders are crucial. But focusing only on personality or background misses the bigger picture.
The best VCs don’t pick between the jockey or the horse. They invest in both. Or as one investor put it, the goal is to find “centaurs”—startups where the founder and business are inseparable and equally strong.