Ben Dahl – Pelion 2 of 2

"Be intellectually honest about what your customers are telling you." Ben is partnering with entrepreneurs who are disrupting large technical markets.

Matthew: Lots of people admire entrepreneurs because they appear to make starting companies look easy. We want to dispel some myths here. We know that it can be very challenging. So, my question to you was: as a founder, what were some of the things that you did well that came intuitively to you and were easy, and what was difficult and how did you manage that?

Ben: The first thing, I think your point is spot on. A lot of people talk about overnight successes, but I don’t believe in overnight successes. Overnight successes, generally speaking, may seem overnight from the outside world, but have generally been on the backs of not overnight success, of late nights working on your business, thinking about your business, and building your business and talking to your customers. Those things take a long time and take longer than most people from the outside really understand. I think it’s important for founders to be realistic about the fact that you’re not going to start at the top and work your way sideways. You really do have to start building a company, and at some point things may get easy, but the first part of it is never easy.

The thing that comes most intuitively, for me, and something that I find very useful in my career now is talking to people and engaging with people, engaging with technologies and being curious. I want to get up every day wondering about all the different things that are around me and all the different things that may impact my business, and asking questions and learning, because there’s so much out there. There’s so much knowledge to be gained from people around you and from circumstances around you. If you can glean as much of that as possible, during the course of your day, you’re much better off.

Matthew: What’s the most important lesson you’ve learned since launching Unspam, and how has that translated into your endeavors at Pelion Ventures?

Ben: I think the first thing is that we really bootstrapped our company, and we, likely, should have sought more capital. I think there’s a delicate balance here between under-clubbing and over-clubbing. You really need to raise enough money that you can have some degree of comfort in building the business but not so comfortable that you don’t have to make a decision or make a bet. I think a lot of founders get into a situation where they’re so dilution-sensitive that they don’t want to raise enough money or because there’s so much money available they take as much as they can.

To have the discipline to raise enough but not too much, I think is an exceptionally important thing for founders to be thinking about when they’re putting their businesses together because, if you do one or two of those things, under-club or over-club, your chances of success go down dramatically.

Matthew: What was the most difficult challenge in transitioning into an investor, and how did you overcome this obstacle?

Ben: I think actually being a founder is actually much harder than being an investor. As a former founder, I love entrepreneurs. I have a great deal of respect for what they do and how hard they work. I think the toughest thing as an investor is sitting back a little bit and letting the founders make some mistakes that you anticipate, trying to guide them away from those mistakes but, to some degree, your founders are going to have to make some mistakes for themselves, even with good guidance from their investors. Having the patience to help and work through those mistakes and make them as small as possible and limiting the impact on the company, I think, is what’s been important for us as investors.

Matthew: What’s the most important lesson you’ve learned since becoming a venture capitalist?

Ben: What really matters is the number you exit at. We talk a lot about valuation and we negotiate valuations and that sort of stuff but, at the end of the day, what you really want is to exit the company at a good valuation, and you want to have a partnership with your investors that makes you want to go to board meetings, and makes you want to interface with them. So, you want to create a big pie, but you also, along the way, want to have fun and enjoy who you’re working with.

Matthew: What mentor has played an impact on your professional development?

Ben: I really have a lot of mentors. The guys that are managing directors at my fund, in particular, have been very good mentors. One of them is the former Chief Technology Officer of Novell and he’s considered a visionary. He has a PhD in math. He’s one of the smartest people I’ve ever met, and he is very good at boiling things down. He’s also been a founder of a venture-backed company and that sort of thing. So, he has a very good view of the world. Despite his education, his background isn’t up in the clouds. He provides a perspective on thinking about investments and things about companies which has been really instructive for me and would make me think, as a founder, differently about a business as I approached it, than I would before.

Matthew: What advice would you like to share with our audience about launching a startup? If you have to distill it, what are the key elements?

Ben: The biggest elements that we look for initially, are you fishing in a big enough pond? Is it a big enough market? Then, as you’re working on this, as long as you’re in a big pond, you need to listen to your customer and figure out where your customer is taking you. You may start out with a view about how your customer is thinking about the market, but you may be 100% wrong. Being intellectually honest about what your customers are telling you and how to respond to those customer requests and customer desires, is very important for entrepreneurs.

I think there are terms that have been overused, like, pivot and what have you. I care less about that than, if the market is telling you something, you need to listen to it.

Matthew: So, what are your next steps, or what’s the direction you’re headed in, in your pursuits as an investor?

Ben: I hope to be investing in companies that will make a lot of money, make our LPs a lot of money, make our founders a lot of money and be involved with companies that are at the top of their game.

The thing about this career and the wonderful thing about it, both as an entrepreneur and also as an investor, is that even though it can be very financially lucrative at the end of the day, it’s a fun process to go through. One of the things I mentioned earlier, is that you really need to choose your investors carefully and choose your co-founders carefully, because the process may be, in some ways, more fun than the outcome.

Matthew: That’s great advice. Thank you for sharing.

Ben, it’s been a great pleasure having you as a guest on FounderLY. We’re rooting for your continued success in your investment endeavors. For those in our audience who would like to learn more about Pelion Venture Partners, you can visit their website at

This is Matthew Wise at FounderLY. Thanks so much, Ben.

Ben: Thank you, Matthew.


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