Fact #1: Founders spend most of their time pitching Product, Problem & Solution. Fact #2: Investors spend most of their time reviewing Financials & Team. These insights are based on recent research on Seed and Series A stage companies conducted by DocSend and Prof. Tom Eisenmann from Harvard Business School. So, if your team is so important to investors, what are the criteria that investors look for when assessing a team? They go far deeper than the job titles or logos that appear under the names on a pitch deck. Having insights into how investors think about assessing a startup team will also help you think about designing your organization and hiring for the right qualities. I’ll break down the questions investors may ask themselves into 4 easy to remember categories:
“Use each opportunity to learn about what investors value about teams, ask them to describe examples they have of the best teams they’ve invested in, and take that feedback to help in building your own team”
“Investors flee from weak teams that lack complementary skills and experience. If you are a technical founder, how are you addressing the business end?”Investors flee from weak teams that lack complementary skills and experience. If you are a technical founder, how are you addressing the business end? Through key team, advisors with specific subject matter expertise, interim staff, or other investors? As Reid Hoffman of Greylock points out, even rich entrepreneurs raise funds for the value-add that invtestors bring to the relationship. This is called “smart money”. In essence your investor can be complementary to your team’s capabilities.