VCs often tell entrepreneurs that they’re looking for “game-changing” technology and a solid management team. It’s become a cliché, but investors believe that having the right management team is even more important than the technology. A great article in The New Yorker by Malcolm Gladwell, author of Tipping Point, Blink, and Outliers, reinforces why the two investment criteria mentioned above are so important to VCs. Gladwell’s article talks about how basketball teams that are smaller and have less athletic ability can beat much better teams. He also gives an example of how a small military force with fewer resources can overcome a larger army, as in the case of Lawrence of Arabia against the Turkish army. Again and again, throughout history, Davids beat Goliaths. What the Davids often have in common are two things: unrelenting effort/persistence and an unconventional strategy. For health care startups to succeed, the same can be said. Genentech and Amgen are good examples. These companies developed innovative technologies at the time, and management had the insight to recognize markets that were overlooked by Big Pharma. Management also had the dedication to overcome many years of setbacks and challenges. Becoming a successful startup is much more complicated than just working really hard and having technology, but one can see why it’s necessary to start with them.