Strengthening relationships is more rewarding than maximizing our financial return
Our fund's performance, consistently ranking in the industry's top quartile, has undoubtedly been a source of pride. It's reassuring to know that our hard work and expertise have paid off over the past decade. However, as we reflect on our journey, we've discovered that genuine fulfillment extends beyond these external validations. While financial success is essential in our business, it's not enough for us. We've come to realize that the real benefits and satisfaction of our work lies in building and nurturing deep human relationships with the founders and people we work with.
I remember vividly the excitement of one of our recent exits when the deal finally closed! The rush was incredible, like a burst of energy that lasted for just a day or two. But soon enough, we were onto the next deal, raising the bar even higher. However, a few months down the line, something truly special happened. Out of the blue, I received a heartfelt note from one of the founders. She took a moment to remind me of an exercise we had done together very early on to help her business, and she made it clear just how much it meant to her. It was at that moment that I realized the true depth and fulfillment that came from the relationship we had built over the years, far surpassed any financial gains from the exit itself.
That's why we make it a priority to work with founders who understand the importance of fostering strong relationships throughout their entire company. It's not just us, investors, who desire meaningful connections, but also employees, customers, suppliers, and everyone involved in the company mission who want to feel the same way.
We have several examples of entrepreneurs who are highly skilled at building deep human connections while doing business. One that always comes to mind is Needed. Julie and Ryan, the founders, have always placed special emphasis on nurturing relationships. They began by investing a significant amount of time and care into building their own connection right from the early days, making sure they were the right fit for each other. Their dedication has paid off, resulting in a robust business that enables them to organize remarkable gatherings and offsites for their community of individuals who share their passion for delivering top-notch nutrition to moms, babies and their families. Organizing these incredible events and helping their community so much with several initiatives might not come cheap, but for Julie and Ryan, it's a priority because they understand the importance of cultivating these relationships. Their strong financial foundation allows them to invest in these meaningful connections and create a lasting impact.
At Crescent Ridge, nourishing deep human relationships is a big pillar of our overall operating principles. Unlike traditional VC firms that operate within fixed fund cycles, we've embraced a different path—an evergreen approach that allows us to think beyond short-term gains. Sure, we could have a much bigger fund if we raised more capital from outside LPs. But we truly value our financial independence to allow founders and ourselves to make values-aligned decisions, even if that means that we have a smaller pot in the short term. We have a continuous pool of patient capital at our disposal, which gives us the flexibility to make investment decisions centered around the long-term. This mindset has become our greatest strength, particularly in an industry where extraction and transactional attitudes dominate, and the relentless pursuit of financial growth often overshadows everything else.
How important is building real deep relationships while doing business for you? We’d love to hear your stories!
Allison and Maria
