The most common question you hear in Silicon Valley is not “When is the next iPhone coming out?” or “Can I get a tour of Google?” More often than not, it is “How can I find funding for my company?”

Securing enough money to grow a business is one of the first goals of every entrepreneur, and perhaps the most difficult. Thousands of small companies vie to attract the attention of venture capital firms, but only a fraction of them make it to the next level. In the case of media companies, the bar is even higher.

John Glynn, founder and managing director of Glynn Capital management, sat recently with us to talk about the industry, the qualities every entrepreneur should have and why journalistic enterprises are a hard sell in Silicon Valley.

Potential for scale

Venture capital firms are funds that invest in small companies that have the potential to scale and become businesses with $50 or $100 million in annual revenue “and that number is going up, not down,” noted Glynn. Besides money, the funds provide support and expertise to the entrepreneurs in exchange for equity, shepherding the business to a public stock offering or a sale to a competitor.

Glynn, who through his fund has invested in companies like Electronic Arts, Intel, Peet’s Coffee and Tea, and Sun Microsystems, characterized venture capital as a “pattern recognition business” where opportunities and risks go hand in hand: “You have an intuitive feel when you see something that is good, that could work, then you do due diligence on the people, on the financial aspect and the market itself,” said Glynn.

Venture capital firms were instrumental in the growth of companies like Google, Twitter and Intel, but they haven’t been involved with media businesses. For Glynn, that has to do with the fact that most media companies started as family businesses, with personal fortunes funding their growth.

The venture capital industry doesn’t have the collective experience and knowledge to feel comfortable investing in the media business. “You invest where you can bring knowledge to the table,” he added.

Glynn, an experienced investor who also teaches several courses on entrepreneurship at Stanford, also acknowledged the technology and healthcare bias at the core of venture capital. “[The industry] feels there is more intellectual property and more inherent profitability in a successful tech company,” he said.

The DNA of entrepreneurship

Stories of successful entrepreneurs are well documented in the media, but the reality is that most businesses fail. Glynn believes that in many cases the problem is the entrepreneur. “Very few people, men or women are cut out to be entrepreneurs. It is a tough road,” said Glynn. “It takes an unusual person with the perseverance, patience, risk-taking ability and constitution to undergo the stresses and challenges that he or she will encounter.”

For those interested in following that path, Glynn offered some advice: do a thorough self-assessment, analyzing your strengths and weaknesses. If you still want to be an entrepreneur after that, “you have to find a market opportunity, not just a good idea that maybe has a global component to it. And you have to figure out how to launch a business, product or service that can gain some kind of competitive advantage that allows you to grow in a reasonable fashion for a period of time.”

Glynn also emphasized the importance of surrounding yourself with a team that shares your vision. When the fund considers an investment, one of the first things they look at is the composition of the management team: “We ask ourselves: ‘Can these people build a culture that can attract and retain people? Is there a value proposition and a need in the marketplace for what they want to do? Is it the kind of place where you would feel comfortable working?’”

Hit and Miss

Venture capital is a risky business, Glynn said. In average, only one or two investments out of 10 pay off; the rest of the money is lost. However, the investments that succeed more than compensate the losses.

The industry in general is highly susceptible to fads and bubbles that can wipe out a firm when they burst. As a survivor of the dot-com crash in late 2000, Glynn reflected on the mistakes that caused the fall: “Frankly, we confused luck and brilliance. We thought we were smart because we invested in those companies, but the truth was that we were lucky that we hit an upswing in the public market that made even our losers successful.”

The media also has a part on the creation of bubbles, he said, because it is easier to sell a positive story than a negative one. “Sometimes you tell people what they want to hear, not what they should.”

The only difference Glynn sees in the Silicon Valley and venture capital business of today is more people hoping to cash in. “We have a lot of seed stage companies being funded that a year or two later can’t attract a significant amount of capital on a round of financing. There are a lot of businesses being funded, but only a small percentage of them have a chance of making it. I can’t tell you why, but the success rate in the entrepreneurial world has never being high. It’s just we have more people today trying to launch a business than we had 20 years ago.”