Venture capital, or VC, is an industry known for its complex and often exclusive language. The use of technical acronyms, lofty descriptions, and industry jargon can create barriers for founders and prevent the industry from being more accessible. In order to foster a more inclusive and founder-friendly environment, VCs need to make a conscious effort to use language that is clear, concise, and easily understood.
Key Takeaway
The use of jargon in the VC industry creates barriers for founders and hinders effective communication. VCs should strive to use language that is clear, concise, and easily understood to foster a more inclusive and accessible environment.
The Problem with Jargon
Jargon in the VC industry is often unintentional, but it can still be a significant barrier to entry. It not only excludes those who are unfamiliar with the terminology but also reflects a lack of understanding and communication skills on the part of VCs. In order to build strong relationships with founders and effectively evaluate businesses, VCs need to minimize their use of jargon and focus on clearly conveying their thoughts and insights.
The Importance of Clear Communication
Clear and concise communication is a core skill in any industry, and VCs need to lead by example when it comes to plain speaking. By using language that is accessible to founders and avoiding unnecessary jargon, VCs can foster a more open and inclusive environment. This will enable them to better support and guide founders in their entrepreneurial journey.
The Role of Efficient Jargon
While jargon should be minimized, there are instances where it can be used efficiently. “Efficient jargon” refers to acronyms and terms that convey common and crucial concepts without repetitive explanations. These terms can make discussions more streamlined and efficient. However, it is important to note that even efficient jargon requires the listener to understand the meaning behind the terms.
For example, the metric “ARR” (annual recurring revenue) has two different definitions, and it is crucial for both parties to be on the same page when using the term. Clear communication and context-setting are essential to ensure that everyone involved understands the intended meaning of jargon terms.
Conclusion
The use of jargon in the VC industry can be a barrier to entry for founders and hinder effective communication. VCs need to prioritize clear and concise language in order to foster a more inclusive and accessible environment. By minimizing the use of jargon and focusing on effective communication, VCs can build stronger relationships with founders and contribute to the growth and success of the businesses they support.
