The Founder’s Guide to the 2017 Investing Landscape
Esther Dyson hit it spot on when she said that there are too many entrepreneurs out there, and way too many who don’t know the fundamentals of how to work and/or build businesses properly. Many young entrepreneurs have never worked for a company, or may have worked briefly for a startup that may or may not have gotten traction/funding, and that’s not the same as working for a company that is not dependent on funding – nor are you likely to learn the fundamentals of building a true, sustainable business that way.
We talk to investors all the time and count some as being among our closest friends/longest-standing acquaintances, and they tell us things – provided that they’re shared anonymously – that they would not ordinarily share with entrepreneurs. We’re going to share some of that information with you here and, for the record, with the prior consent of those investors, and a special thanks to Veronica Guzman of WAM Ventures, who did give us permission to mention her name, for her comments and insights.
Many founders – especially first-timers – believe that pitching to investors is a panacea. Note to self: we do attend many accelerator demo days and one investor recently told us that he was writing checks to companies he had met through the accelerator, which is why he goes to demo days: to suss out good companies. Mind you, he was writing those checks to companies he had met through the accelerator three years prior, and not that day. He had been keeping a watchful eye on them, and now that they were ready (meaning, had traction/customers/sales), he was all in. A company that has nominal revenues and has only been in business a few months is asking for major disappointments, if getting funded is their goal at that point, another investor recently noted. “Advisors are telling them to pitch angels this way,” Veronica noted.