We sat down with Charles Birnbaum, Senior Associate at Bessemer Venture Partners, to discuss investment philosophy, due diligence, and portfolio diversification.

What is your investment philosophy?

• Be thorough in investigating companies before investing
• Don’t invest in competitors
• Support companies through multiple rounds of funding

What do you look for in a team?

• A team must be doing it for the right reasons
• They should know how to build a culture
• Look for a team that knows how to sell
• A group should complement each other
• Look for a team that has worked together in the past

What do you think about competition in a given sector?

• A market is often big enough for multiple competitors
• Understand the competition before investing in a company

“The hardest thing about investing is you can only make a few bets. It’s more of a time constraint than it is a capital constraint.”

How do you perform due diligence?

• Complete due diligence before extending a term sheet
• Do reference checks on team members
• Talk to customers
• Look for positive market signals

How do you diversify your portfolio?

• Invest in different sectors
• Invest in different stages

What advice do you have for those in VC?

• You can only make a few bets
• Be direct with entrepreneur
• Look for opportunities in an area you’re passionate about

Charles Birnbaum joined Bessemer in 2013 and is a Senior Associate in the New York office. He focuses on investments in the mobile & communications, financial services, and consumer web sectors. Prior to joining Bessemer, Charles spent three years at Foursquare, a location-based mobile application company based in NYC.  As an early member of the Foursquare team, Charles helped create and bring to market some of Foursquare’s first merchant-facing tools. He then became Director of Mobile & International Business Development focusing on carrier, OEM, and strategic partnerships and led the company’s business development efforts in key growth markets such as Brazil, Russia and Turkey.

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