Fred Wilson recounts:
In the early days of Tumblr, I used to bug David Karp, the founder and CEO of the Company, about comments… I wanted to be able to comment on other tumblogs and the vast majority of them had no comments because Tumblr did not support them natively. I was fairly persistent in my argument. But David held firm… Eventually, I gave up and moved on to pestering some other entrepreneur about something I thought they should do with their product.
This is tricky territory for VCs and entrepreneurs. Because most of the time the entrepreneur will have a better feel for their product vision than the VC will. But there are times when what the entrepreneur is doing is not working and the VC will have to figure out how to get the entrepreneur to see that.
(1) Is this really an issue of “sometimes the VC is right, sometimes wrong”? I don’t think so. Good VCs actively use their companies’ products, so they’ll have opinions. But VCs usually aren’t great product people, due to the innate personality differences of the most successful VCs and product managers. So VCs’ opinions about product shouldn’t have “board member” weight, but should be treated with the same weight as feedback from other committed users.
(2) If the VC thinks the company has a real product problem, she should address that as an HR issue to be discussed with the CEO. Is the person leading the product team good enough?
(3) This is a good example of a situation where you need to recognize the dividing line between your core competencies and the areas in which you have opinions but no competitive advantage.