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Dean Blount's Blog
  Dean Sally Blount and Kevin Efrusy
 

Kevin Efrusy is a partner at Accel Partners. He taught me that building a strong venture capital firm and a strong business school have far more in common than I ever realized.

Photo by Maggie Rife

   

On a Culture Note
March 10, 2011

At Kellogg’s Private Equity and Venture Capital Conference last month, I learned that building a strong venture capital firm and a strong business school have far more in common than I ever realized. The conference had a terrific line-up of speakers. Kevin Efrusy was one of them. He’s a partner at Accel Partners, early investors in both Facebook and Groupon.

Principles for Building Strong VCs and B-schools

Kevin made several important points, including: it’s “not about being smarter, but taking the right risks,”and it’s all about “making forward bets on people.” In academics, that’s the name of the game when you’re hiring faculty. You’re betting on their future potential, especially in research. You want to be the school to find and nurture the future Nobel prize winners and NSF Young Investigators. Kevin also emphasized the importance of “building a strong culture, not a star system.” At Kellogg, we have the good fortune of being the ultimate strong culture competitor in the business school arena, so that parallel also really struck me.

Building a Strong Culture

Building a strong culture is about creating an organization that draws people in because the experience of being there offers something special. It means building an organizational identity that engenders pride and psychological attachment within the individual and fosters meaningful connections between and among people. In star systems firms, connections tend to be transactional. The calculus of membership is clear—I give you X, you give me Y. When I stop getting Y, or I can get more Y somewhere else, I leave. That’s it. There’s nothing else tying me.

Strong cultures take years, if not decades, to build, and they’re very hard to replicate. That’s because meaningful human attachments are nuanced and delicate. That’s also why it is widely held that culture may be the only true source of competitive differentiation in knowledge-based industries, where talent is always mobile. People in strong culture firms are not as easily bought away.

When you have a strong culture like Kellogg does, continually renewing and shaping that culture is key to ensuring your long-term vitality and competitiveness . . .so we’re spending a lot of time on campus this spring talking about our culture and what makes it distinctive. For example, it’s not just collaboration, but a passion for collaboration that typifies Kellogg. (We understand that it’s not individuals who change world, but highly-focused, highly-energized groups.)There’s also a groundedness and balance to the people who come to Kellogg—we tend to attract low-ego types who are committed to organization- and market-building, not just personal rent-seeking. But that doesn’t mean that we’re not incredibly ambitious. After all, we’re out to build and lead the 21st century teams that will transform firms, markets and management education once again.

I welcome your comments, feedback and ideas at sallyblount@kellogg.northwestern.edu

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