By Jamie Beaumont, managing partner at LEGO Ventures
“There is no innovation and creativity without failure. Period.” — Brené Brown
“Progress is impossible without change, and those that can’t change their minds can’t change anything.” — George Bernard Shaw
“Imagination is more important than knowledge. Knowledge is limited. Imagination encircles the world.” — Albert Einstein
There is no shortage of inspirational quotes around the subject of innovation, and almost all of them reference the importance of what we call 21st century skills. These include competency skills like creativity, critical thinking, collaboration, and character skills such as resilience, curiosity, and adaptability.
Why are these skills so important for us as venture investors? Why do so many VCs talk about backing founders as much as they talk about backing companies? In broad terms, a specific idea has one (very small) chance of being successful. Simply put, it either works, or it doesn’t. A founder, on the other hand, has several chances.They can pivot, adapt, change, and evolve. The ability to learn and iterate is fundamental to a founder achieving success. Ultimately your customers will tell you what they want, and the product that finally succeeds in the market will almost certainly be very different from the first imagining of what it may have been.
In this context, inflexibility, close-mindedness, and dogmatically held beliefs are the enemy of innovation, no matter how well one has identified the problem or the pain point they are seeking to solve. Too many rely on stories and use them to dismiss what the data is telling them.If you are unable to analyse the data, listen to feedback, adapt, and evolve, then your ideas are unlikely to survive in the real world — no matter how great the narrative.
Collaboration & communication
Holding such inflexible and dogmatic beliefs are not the same as having conviction.The best innovators are able to simultaneously exist in the present and the future. In innovating, they are making predictions and placing bets on that future, and that takes courage and the ability to bring others with you on the journey. Here, conviction is key — but so too are communication and teamwork.
A founder needs to balance competing priorities such as development time, feature selection, costs, and many other functions needed to create a successful business. No-one has a mastery of all the disciplines required to be successful, so finding talented people to share your vision is vital. Once you have done so, working out how to collaborate successfully is fundamental to becoming a high-performing team (as opposed to a team of high-performing individuals).
Effective collaboration relies on agility and being receptive to new ideas. It also requires a space where failure is nothing to be afraid of, and instead where it is necessary to learn and grow.
Iteration is key
There are plenty of statistics on how second-, third-, or fourth-time founders are more likely to succeed than first-time founders. This represents the need to learn along the journey, and explain why investors view experience and failure as a positive Founder attribute. It’s a signal of resilience as well as an opportunity to understand what it takes to succeed.
So if you’re a founder, think about how you balance conviction and flexibility. Think about how you can show an iterative mindset, and encourage it within your companies.Consider hiring for skills and abilities rather than knowledge and understand how you can develop these skills over time.
This brings me back to one of our core beliefs at LEGO Ventures. We believe in learning through play, at all ages. We believe that important skills are acquired when the act of learning is joyful, iterative, socially connective, meaningful, and actively engaging.
Encouraging 21st century skills
It’s no secret that education is changing; the shift from traditional knowledge-based education to a more comprehensive view of learning has been slow, but it’s accelerating. Particularly now, during the COVID pandemic, there has been a rapid acceleration in the rate of change around how people learn. We are entering a time when people have more control than ever over what, where, and how they learn. It represents an incredible opportunity for entrepreneurs wanting to make an impact to tap into this substantial societal shift.
So, when we say we invest in 21st century skills, we mean start-ups tackling this space in education, but we also mean their founders too.
This was originally posted by LEGO Ventures here.