Almost every VC in France will claim to be a hands-on investor if you ask what differentiates them. Often even the English expression “hands-on” is used in a French sentence, i.e. “Notre philosophie d’investissement est d’être très ‘hands-on’ avec nos sociétés en portefeuille.”

Reminds me of the town near Lake Wobegon where all the children are ‘above average’.

At Truffle Capital, we certainly are guilty of claiming to be hands-on. I’d like to think that it’s true. Our hands-on investment philosophy at Truffle is largely driven by the backgrounds of the principals : most of us are former entrepreneurs.

But what does it mean to be a hands-on investor? Is sitting on the board of a portfolio company sufficient? Is it enough to merely demand rigorous financial reporting every quarter?

I would submit that being a hands-on investor means much more than that. For us, it starts with being an active board member. We view our role to encompass everything from serving as a sparring partner with management when thinking through strategic initiatives, helping to attract key personnel and especially non-executive board members or resources, leveraging our luxury of hindsight from the successes and missteps of prior portfolio companies, to even assisting with operational items which may not typically fall within the course of normal business.

To cite a recent example, when our Anglo-Dutch portfolio company MoMac decided the best way to enter the French market was by way of a local acquisition, we made an exhaustive review of the local competitors, met the CEOs of many of them, distilled a short-list of the most compelling targets, and ultimately negotiated and structured the final transaction on behalf of MoMac’s management. While MoMac’s management team is perfectly capable of executing such an operation, our taking the lead in the transaction process allowed the MoMac guys to focus on strengthening their core markets and to ready the business for integrating this new acquisition.

Like I said, I’d like to believe that we are genuinely hands-on in our investment approach, and even more importantly, that such an approach contributes value to our portfolio companies.

But ultimately I leave it up to our portfolio company management teams to decide.