Funding Startups Part 2: Build your A-Team to Bring your A-Game
Updated: Mar 22, 2021
One of the most important things that investors evaluate in detail is the startup’s team. The team is not only vital in respect to their industry knowledge, technical know-how, and fundraising ability, but also as a team of collaborative leaders. Many startups seek to disrupt or change current ideas or practices in their industry, in doing so, headwinds are often inevitable, and the leadership of the organization must be able to continue to collaborate and instill confidence and excitement when the going gets tough.
We have seen teams who get personally offended, flustered, or lose sight of their true vision when their assumptions, strategies, and beliefs are questioned. These teams raise big red flags, as this type of adverse reaction to pressure can mean trouble for the company and any investment when the internal KPIs are not being achieved as planned. To make matters worse, if the other members of the team are uncomfortable trying to help solve these solutions in a collaborative fashion the chances of failure increases.
Not only is mettle and collaborative ability required in a startup's leadership team, but so is a true belief in the vision. During one presentation, the startup's CEO completely lost their momentum, they could not answer questions, took personal offence to the questioning of their assumptions, and started getting visibly upset with the committee. If it was not for the rest of the team who believed in the vision and were able to step in and bring the meeting back on track, the leader would have blown the opportunity. This CEO may not be the greatest under pressure, but did make one right strategic choice that meant the difference between their success and failure, the team.
In closing, investors don't always look at the CEO as representative of the entire team. The committee looks to see if the team around the CEO is technically capable, that they truly believe in the startup's vision, have a deep understanding of the startup's strategy, and that there is a culture of real collaboration and teamwork.
So don’t be afraid to share the stage with your team, often the investors may prefer to hear from a variety of the team members who are in charge of the specific aspects being asked about than from the CEO alone.