Boris Wertz is a top tech early-stage investors based in Vancouver. He is the founding partner of Version One and a board partner with Andreessen Horowitz. Previously, Boris was the COO of AbeBooks.com which sold to Amazon in 2008. I recommend to read his blog and follow him on Twitter.

Visual summary of operating lessons from Boris Wertz, Partner at Version One.

The Founder’s Operating System

  1. On Scaling to $100 Million: "Generally speaking, there are two ways (and only two ways) to scale a business to hit that $100 million threshold: Your business has a high Life Time Value (LTV) per user, giving you the freedom to spend a significant amount of money in customer acquisition. High LTV can usually be found in transactional or subscription businesses. Your business has a high viral co-efficient (or perhaps even a network effect) that lets you amass users cheaply without worrying too much about the monetization per user or spending money on paid acquisition."
  2. On Protecting the Core: "Never, ever outsource something that is core to your business. Outsourcing a core function may give you a short-term uplift, but it also means you fail to build the expertise within your company. If you want to build a sustainable competitive advantage, you simply can’t outsource your core functions to another who may not be as invested in your success. In other words, you can’t build a great company on an outside agency’s stuff. The number one marketing priority for any start-up is to figure out a clear communication strategy for the brand and the product — the message must be simple, clear and differentiated. Users must understand right away what problem the product solves and why they should use it and engage with it. And hopefully you also take this communication opportunity to show a bit of personality!"
  3. On Learning Through Experiments: "Too many start-ups fall into the pitfall of running experiments for the sake of running them, and then never actually learn anything since the parameters were too fuzzy. Drive your activities toward reaching tangible learning milestones…as many as possible, as fast as possible."
  4. On Long-Term Vision: "To be wildly successful, you cannot sacrifice your long-term vision for short-term success just as you can’t sacrifice your current product and customer base for your long-term vision. You need think about innovation in start-ups in 3 time horizons: short-term, mid-term, long-term. Short-term innovations are incremental, mid-term you need to make bigger bets and long-term you need to define a new market category."
  5. On Pivoting Decisively: "Course changes happen all the time and can lead to brilliant things. But when pivoting, you need to completely separate your old and new businesses. Approach your pivot as if it were a completely new startup. Then see which pieces of your current setup (people, product, etc.) can potentially help you accelerate the new opportunity."
  6. On World-Class Standards: "The entrepreneurs who succeed always have a unique perspective as to what is world-class — they don’t limit their perspective to what is best in Canada. It’s a super-important benchmark to always have in mind. Today you have a worldwide market. There are no national barriers any more."
  7. On Building Before Exiting: "Amazon was, from the beginning, the natural buyer. But it took a long time: nearly three years from when negotiations started until the deal closed. So the major lesson is that you can’t plan for an exit. Stay focused on building a really great business. I’m not interested in founders that think about an exit right away. I want people to think about how to build a great stand-alone company."
  8. On Decisive Meetings: "One key message that can apply to any start-up is to never end a meeting without a decision (unless everyone determines that more data is needed to make that decision). If a meeting begins to succumb to group think and indecision, you need to ask why we can’t make a decision today instead of another day. After all, you just need to move forward."
  9. On Regret-Minimizing Decisions: "Here’s the principle that I’ve really started to embrace. Ask yourself the following: If you look back at this decision 10 years from now, which path will you most regret not having taken?"
  10. On Stubborn Vision: "You need a clear vision of where you want to go and the values that will guide you towards that place. You need to be opportunistic (aka flexible) when it comes to all the details of how to get there." — Version One Ventures
  11. On Pre-PMF Restraint: Experienced founders can undermine their own flexibility by raising too much and building a large team before product-market fit, making necessary pivots much harder. — The Neon Show: Lessons From 25 Years of Investing

Venture Craft and Outlier Investing

  1. On Founder Conviction: "We never had much success when we had more conviction about the business than the founders." — Techcouver
  2. On Expanding Technology Markets: "Everyone (investors and founders alike) has underestimated the size of the addressable market for tech over the past decade." — Version One Ventures
  3. On Venture’s Capital Flywheel: "Increased returns will attract more capital to venture as an asset class... The world has its fair share of problems that we need to tackle and technology can play an important role in it. More dollars available for those venture opportunities means more and quicker progress!" — Version One Ventures
  4. On Venture Time Horizons: Early-stage venture portfolios require exceptional patience because their strongest returns may not emerge until ten to fifteen years after the original investments. — The Neon Show: Lessons From 25 Years of Investing
  5. On Investor Taste: Portfolio construction can be improved over time, but an investor’s taste for exceptional founders and unusual outlier opportunities is much harder to teach. — The Neon Show: Lessons From 25 Years of Investing
  6. On Continuous Reinvention: Success as a generalist investor requires a constant willingness to rebuild one's networks and knowledge base from scratch to find the next major shift. — Version One Ventures Blog
  7. On Staying Open to Outliers: Despite having defined focus areas, a firm must leave space for extraordinary founders who are building completely outside of the firm's current theses. — Version One Ventures Blog

Building Canada’s Innovation Economy

  1. On Strategic National Focus: A smaller country should change its playbook and concentrate on sectors where it has real structural advantages instead of trying to lead in every field. — RBC Disruptors: Canada’s Tech Growth Challenge
  2. On Commercializing Research: Producing world-class research is not enough; an ecosystem must also turn that research into companies and scale them. — RBC Disruptors: Canada’s Tech Growth Challenge
  3. On Activating Private Capital: Canada should move more pension and other private capital into the innovation economy rather than depending primarily on government-sponsored programs. — RBC Disruptors: Canada’s Tech Growth Challenge
  4. On Procurement as Startup Fuel: Government and corporate procurement can give technology companies the real revenue traction they need to raise additional private capital. — RBC Disruptors: Canada’s Tech Growth Challenge
  5. On Investment-Backed Immigration: A founder visa should use real investor capital as its central quality filter instead of allowing qualification through an incubator letter without financial backing. — Maclean’s: Canada’s Entrepreneur Opportunity
  6. On Modern Investment Thresholds: Immigration investment requirements should be periodically updated to reflect the actual capital needed to build a credible startup in current market conditions. — Maclean’s: Canada’s Entrepreneur Opportunity

AI and Business Model Reinvention

  1. On Double Disruption: "The most powerful disruptions occur when a technology disruption and a business model disruption go hand in hand. This ‘double disruption’ forces incumbents to get up to speed with a new technology and a new business model at the same time." — Version One Ventures
  2. On Outcome-Based AI Pricing: "Currently, most enterprise SaaS companies sell software based on seats, but true AI-native companies will replace human labor and they should sell outcomes, not software." — Version One Ventures
  3. On the Pace of AI: "AI isn’t sprinting to AGI — it’s pacing into the mainstream. That means more room for founders to build, compete, and ultimately define what AI becomes." — Three Years of ChatGPT: Where We Are With AI Today
  4. On AI’s Real Bottlenecks: Today's true bottlenecks are better prompting, smarter verification, and novel business models; startups that solve these specific pain points will stand out. — Version One Ventures Blog
  5. On Where AI Value Accrues: The AI ecosystem will likely see its value cluster at the extremes: close to the metal (infrastructure and compute) and close to the customer (deeply embedded workflow applications). — Three Years of ChatGPT: Where We Are With AI Today

Robotics and Engineered Biology

  1. On Purpose-Built Robotics: The earliest and most successful adoption of robots will come from point solutions designed for specific tasks rather than generalized humanoids. — Version One Ventures Blog
  2. On Robotics Value Creation: Simply being cheaper than human labor is rarely enough to win over a market; a robotics solution must create new value by being faster, more accurate, or significantly better. — Version One Ventures Blog
  3. On Software as the Hardware Moat: As physical robot hardware becomes increasingly standardized and commoditized, a robotics startup's true defensibility shifts from its physical components to the software layer that makes the machines intelligent and useful. — Version One Ventures Blog
  4. On Biology’s Engineering Era: The fundamental shift in biology is not that the underlying science has become easier, but rather that new tools and AI are enabling unprecedented ways to construct and scale solutions. — Version One Ventures Blog
  5. On Modern Biotech Founders: The ideal founders in modern biotech are often deeply technical outsiders who use AI to bring new perspectives to legacy problems, rather than traditionally trained biologists. — Version One Ventures Blog

Sources for the original lessons

  1. We don’t have enough great tech companies
  2. How to overcome decision paralysis
  3. How to really learn from your experiments
  4. How to stay nimble as you scale
  5. If you need to pivot, pivot hard
  6. Never, ever outsource your core
  7. The only 2 ways to build a $100 million business
  8. Version One founder Boris Wertz tells Canadian entrepreneurs to look abroad
  9. Why you need to innovate on three horizons