Founder vs Investor: both sides of the table

Founder Investor Lens

I was a VC in the really early part of my career, then became an operator+angel investor for several years, before founding Workomo. Here’s how my lens for looking at company-building has evolved from an investor then vs. founder now:

#1 Doing 0-to-1 is really hard — as an investor, I never truly realized how hard it is to “make something people want” from scratch & have someone care enough to try using what you have built. The struggles of building from 0 can only be truly understood when experienced first-hand.

#2 Appreciation for engineering talent — as an investor, while one understands the importance of quality developers, the focus tends to be more high-level in terms of looking at leadership (CTO/VPs). As a founder, I now feel gratitude when I work with top-tier functional engineers.

I have seen how a solid iOS engineer can save weeks of extra cash burn while delivering excellent output. Or how quality backend engineers are so hard to find. Or in a small engineering team, a developer with 20% better output can really move the needle via effort-compounding.

#3 Importance of iterations — as an investor, I don’t remember ever asking founders: “how many iterations did it take you to get here? And what did you learn?”. Perhaps, ‘cos I had never been a 0-to-1 founder, I focused more on “outcomes” and never on the “process”.

Now as a founder, my core operating philosophy revolves around 1) “lean” iterations, 2) systems-thinking & 3) agile dev. (hypothesize-build-get users-learn-iterate-repeat). When facing high failure rates & random outcomes, the only thing you can truly control is the process.

#4 Re-orienting from “speed” to “velocity” — a piece of frequent advice I gave as an investor was “do things at even more speed” or “how can we ship even quicker?” or “can we fundraise even sooner?”. It was missing one thing: “are we moving quickly enough IN the right direction?”.

Investors want quick results, whereas as a founder, you know building outstanding products takes time & thoughtfulness. Even if you ship quickly, building the wrong thing without pausing to learn, analyze & re-orient will result in no one using it.

#5 Design is not just UI/ UX, it’s end-to-end product experience — as an investor, my view of a portfolio company’s product was just limited to what “I could see” and what “I could use”. As a founder, I now think about “what the user will FEEL”, right from the landing page, down to repeat usage.

#6 Effective teams aren’t just about assembling the most talented — as an investor, one primarily looks for signals of talent (track record, pedigree, intelligence, expertise). As a founder, I now include commitment & fit in the hiring matrix. Sometimes even as a filter.

While “how can we hire an engineer from Google or FB” is a good question to discuss with investors, other high-impact questions that need focus include “how is the team morale?”, “how can we better reinforce the vision.” or “how is trust being built as a remote team?”.

#7 Limited value of startup playbooks — a common technique investors use to try and add value to the portfolio is sharing what other companies/ founders are doing, their approach, what seems to be working for them etc. I have been guilty of this as well.

While there is some merit to having market intel & learning from other founders’ experiences, you quickly realize as a founder that all so-called playbooks are biased, post-facto analysis & polished versions of reality. You gotta figure out your own unique way.

#8 Who is a co-founder? — when looking at co-founders in a team, the top things I would primarily evaluate as an investor: 1) do they have complementary skill sets (engg+product+biz)? and 2) will this team look good enough on a deck, to be able to raise the next round?

Now with the perspective of a founder, I evaluate many other facets in founding teams: 1) does this person have the same level of passion, desire & commitment to building this company?, 2) when sh*t hits the fan, will this person be last-person-standing, 3) how much can this person sacrifice to see things through till the end?

#9 “Closing” with no logos behind you is damn hard — with IDG Ventures or Alibaba behind me, all doors were open. I could reach anyone, get quick responses, and easily attract people to my projects. Made it easy for me to say to founders: “let’s close this deal” or “let’s hire this person”.

As a founder, I have now felt how hard it truly is to hire, close deals or close any opportunity for that matter, when you are trying to build an unproven company, on a vision that’s new & hard to visualize, with a product that keeps frequently changing & has no scale yet.

#10 Guarding your mental state is everything — startups are a mental game. All the awesome founder qualities that people talk about — grit, perseverance, belief, conviction, are all internal. Perhaps the biggest miss I had as an investor is not observing the mental state of founders.

This becomes especially challenging as founders like to put up a brave face in front of their investors. I now strongly believe that it’s the job of investors to look past this veil of confidence and help unshackle their true mental state. I regret not doing this the most.

Ultimately, investors become successful when they back the best founders, who then get lucky :). Similarly, founders improve their odds by having the best investors in their corner. Personally, it has been incredible to experience both worlds & realize how different they are.

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