Managing Your Investors – A Founder’s Perspective

Siddhartha Ahluwalia, founder of AddoDoc, a startup in which I am an angel investor, shared his insights about how to deal with investors.

First , I would like to say – choose your investors wisely. If you are raising from multiple people you should ensure that at least your 2-3 most active investors are in sync with each other.

For your angel / seed round raise less money, but don’t take it from people you don’t like having a 1-2 hour meeting with. Founders know what a nightmare – pitching and getting a reluctant investor to commit can be. Imagine what your life would be like if you have to spend a few hours each month with that investor. Raise only from people with whom every meeting is like – “I came out wiser from the meeting.”

It’s not that founders don’t want to talk to their investors. Founders feel that they haven’t made much progress, so there is nothing new to share with their investors. However, good investors are process driven, and they understand that it’s a marathon, and not a sprint.

Mature founders have a 3-4 year timeline, and they don’t care about your weekly growth. They try to ensure that you remain focused on growing your company and fine-tuning your product, specially after their money is in your bank. Don’t take money from investors who are just waiting for you to raise the next round so that they can exit. You have to be able to read between the lines – is this investor in for the long haul, or is he looking to flip for a quick gain ?

Finally, ask for help from your investors – you can afford to be shameless about this – after all, they invested in you because they believe in you! The first step is knowing what you want from them, and that is half the work done. The rest involves following up with them , until your task is accomplished.

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