Mercenaries need not apply to Bahles

November 22, 1999

BY MICHAEL KRAUSS

This is one of an ongoing series of articles on interactive marketing leaders. They're the emerging leaders of an emerging marketing discipline.

Name, rank and serial number: Shanda Bahles, 43, general partner, El Dorado Ventures. Studied journalism, then electrical engineering, at Stanford, received B.S. in electrical engineering, '77. Joined a series of technology companies-Infotek Systems, Magnusson Computer Systems, Millennium Systems, Fortune Systems-in engineering and marketing roles. Earned MBA at Stanford, '85. Joined El Dorado Ventures in '87.

Mantra: "You need a passionate core of people to build a company."

How would you describe El Dorado Ventures? "We're typically the first institutional investors in a start-up."

What kinds of deals do you want to see? "We look for companies that have the opportunity to dominate a new market."

Where has El Dorado been successful? "We were early investors in Sun Microsystems, Earthlink (a consumer ISP), Novellus Systems (a semiconductor equipment manufacturer) and Pilot Network Services (a high-end ISP).

Who makes a good entrepreneur to back? "Mercenaries don't make good entrepreneurs; they don't want it enough. You need somebody who, when times get tough, they dig down and figure out the n+1 thing that they have to do to make a venture succeed."

How do you sort out who's going to be successful as an entrepreneur? "That's the secret sauce. That's why we get paid the big bucks."

How important are the hard analytical skills? "I'm in early-stage venture funding. I'm not a big fan of analytical models; it's garbage in, garbage out. Who would have guessed the metrics of the Internet?"

Should marketers move into venture capital? "The culture shock of going from P&G to a venture-capital firm may be a little too big a step. People think it's a really sexy job, very exciting. They don't really know what we do."

When should you move into venture capital? "When you're ready to be a coach instead of a player. You're not the one throwing the ball-you're the one on the sidelines trying to put the right people on the field and into the right positions to be successful."

Career advice if you're not going to P&G? "Go West. Go to a start-up. Go to a place where you get a sense for the chaos of formation that Silicon Valley is all about. If you want to play it a little safer, get some Internet experience within your current organization."

What did you learn from your first job experiences? "The PC (the new, disruptive technology of the time) was the place to be."

Why did you go into venture capital? "I liked start-ups, but I didn't have a burning passion for a particular start-up. I didn't have a product idea that I wanted to take to market. I thought if I went into venture capital, I'd get to look at a few start-ups and jump into one."

What do you do day-to-day? "Find and recognize opportunities. Make sure I'm in the places where the interesting things are happening. Market and sell our services. Make judgment calls on whether a team is going to be able to execute."

Bottom Line: "Today more than any other time, technology is interesting, but not sufficient. It's all about execution-marketing, sales and technology execution."

Michael Krauss is a partner with Diamond Technology Partners in Chicago.
He can be reached at news@ama.org.