Ask an Investor: What should I read over the holidays?

Silicon Valley Dinesh

Welcome to a new BetaKit weekly series designed to help startups and entrepreneurs. Each week, investors Roger Chabra and Katherine Hague tackle the tough questions facing founders today. Have a question you would like answered? Tweet them with the #askaninvestor hashtag, or email them here.


There have now been over twenty editions of Ask an Investor! As Katherine and Roger recharge over the holidays, we’ve taken the time to compile all the knowledge they’ve dropped in one handy guide for holiday reading. Special thanks once again to our sponsor, TribalScale, for making this all possible. Did we mention they’re hiring?

Pre-fundraising

How do I name my startup?

A startup name is something you are going to have to live with for (hopefully) a long time. Choose wisely.

How do I create a valuation for my startup?

Two different methods for crafting a valuation for your startup.

Dissect my deck (CareGuide)

Instead of answering a common question we often see as investors, we give feedback on one of the most important parts of the fundraising process: the pitch deck.

Fundraising

How do I decide when to raise my next round?

To answer this question, we need to talk about runway.

How can I hack the fundraising process?

Founders are always trying to hack the system, even when it comes to fundraising.

How do I manage an oversubscribed round?

It’s flattering to have many offers to invest and it is tough to turn down money, especially in today’s financing environment.

How do I perform due diligence on a VC?

While any money can look like good money at first, not all investors are created equal.

Should I let angel investors into my VC round?

Just like VCs, not all angels are created equal.

What do I do when my lead VC doesn’t want to follow-on?

Unpacking a sticky situation.

What are common mistakes I should avoid while raising my funding round?

DON’T DO THESE THINGS!

How do I say no to an investor?

Honesty is the best policy.

Should an investor tell you why they said no?

You need to understand to understand if the problem is the investor, yourself, or your company, product, or business model.

What happens when my lead investor won’t lead?

Lose their phone number.

Should I announce my funding?

There are many great reasons to announce that could actually have strategic benefits for your business. Make sure its one of these reasons driving your announcement

Should I celebrate my funding round?

Fundraising does not mean that a company is profitable; it doesn’t mean that anyone has actually made money; it doesn’t even mean that a company is growing.

Founder stuff

What are stock options, and how do they work?

There is no set rule as to what percentage of the company each early employee should be granted in the form of options.

When should I start paying myself as a founder (and how much)?

Working towards an exit shouldn’t prevent founders from a salary. The clearest lens to look at founder compensation through is company stage.

What do I do when a company wants to acquire my startup?

From start to finish, an acquisition can take months. Make sure the interest is real and genuine.

Co-founder(s) stuff

Do investors back companies with one founder?

Yes! Here’s why.

How do I find a co-founder?

Adding a co-founder changes the DNA of a company, and you need to make sure that you are excited about the changes adding this new person will bring.

Should I bring my co-founder to a pitch?

Founders feel the need to attend each and every pitch. Resist the temptation.

How do I fire my co-founder?

Making the best of a bad situation.

Got a question for the investors? Email them here.

Douglas Soltys

Douglas Soltys

Douglas Soltys is the Editor-in-Chief of BetaKit and founder of BetaKit Incorporated. He has worked for a few failed companies and written about many more. He spends too much time on the Internet.