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?
A startup name is something you are going to have to live with for (hopefully) a long time. Choose wisely.
Two different methods for crafting a valuation for your startup.
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.
To answer this question, we need to talk about runway.
Founders are always trying to hack the system, even when it comes to fundraising.
It’s flattering to have many offers to invest and it is tough to turn down money, especially in today’s financing environment.
While any money can look like good money at first, not all investors are created equal.
Just like VCs, not all angels are created equal.
Unpacking a sticky situation.
DON’T DO THESE THINGS!
Honesty is the best policy.
You need to understand to understand if the problem is the investor, yourself, or your company, product, or business model.
Lose their phone number.
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
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.
There is no set rule as to what percentage of the company each early employee should be granted in the form of options.
Working towards an exit shouldn’t prevent founders from a salary. The clearest lens to look at founder compensation through is company stage.
From start to finish, an acquisition can take months. Make sure the interest is real and genuine.
Yes! Here’s why.
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.
Founders feel the need to attend each and every pitch. Resist the temptation.
Making the best of a bad situation.
Got a question for the investors? Email them here.