The Dream Team - What investors look for?
I know that the first thing investors look for is a good strong team. Until recently, I thought that just meant the founder and co-founders. However, I was just checking out angelist, and most of the start ups list the founders, advisors, employees, references, and something called a "referrer" (which I assume is probably an angelist thing). I may have answered my own question on this, but Id really like to hear input from everyone. So my question is this;
If you were building a team, with the the future intentions of looking for funding, what would your "dream team" look like? Not naming people, but positions...like One coder, one design guy, three advisors experienced in, etc...
Thanks for your input!
Advisors Funding Venture Capital Investors
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Wouldn't it depend on what the team is supposed to do? – Joel Spolsky 12 years ago
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Everybody full-time, all in. – Frenchie 12 years ago
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Lets just say that your building the next great social network. From an investors point of view, do they look at who your advisors are? Or who your employees are? References? Or is it just the founders they are looking at? When they look at a "team"...what would there definition of a "team" actually be? I guess that would be the better question. – Derek 12 years ago
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When investors looking for dream team, they want to know if you are all competent at your jobs. If you have management position and you are telling about your great ideas, this is not what they are looking for. – Andrew Smith 12 years ago
2 Answers
Opinions vary. Here are a few:
http://gust.com/angel-investing/startup-blogs/2012/04/10/5-traits-investors-look-for-in-entrepreneurs/ http://www.bothsidesofthetable.com/2010/10/06/the-four-main-things-that-investors-look-for-in-a-startup/ http://blog.startupprofessionals.com/2011/06/investors-look-for-these-six.html http://www.geekwire.com/2012/bill-bryant-time-startup/ http://www.podiumventures.com/blog/72-5-things-investors-look-for-in-a-startup http://thedrawingboard.me/2011/09/12/how-does-an-investor-evaluate-a-startups-team/ Many boil down to Team competency (technical+market experience) , Addressable Market (size + verified customer research + traction are pluses), commitment to team & market (be it personal invested time or money - different views abound) .
My 2 cents: How well you know your target market post launch and how you are addressing it seems important of late - it's not just about how quickly you can assemble and launch, its how quickly can you validate your assumptions and adjust to feedback. A slide deck which that information goes a lot further than why you think your market and people is/are awesome!
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@Jimg...thank you very much for the articles. I read them all. Each one gave me a little more info. Another question for you...when an investor is looking at a team he is considering investing in, is he looking at only the founders? Or is he also looking at who their advisors are, who their employees are, and references? Thanks again, I really appreciate the time you dedicate to answer questions like mine...as dumb as they may be! lol – Derek 12 years ago
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Hi Derek - only my opinions - YRMV. (are they) looking only at founders? A fundable CEO is extremely important, as is the management team. Domain knowledge - also important. Advisors - depends on the market / company. Pharma matters more than, say, a social iphone app. Market and the mgmt teams documented customer experience proves domain understanding and team skills. See http://steveblank.com/2009/11/12/%E2%80%9Clessons-learned%E2%80%9D-%E2%80%93-a-new-type-of-vc-pitch/ as an example. – Jim Galley 12 years ago
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THAT'S the answer I've been waiting for. Thank you very much. – Derek 12 years ago
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With taking feedback it's actually a very good one. There is nothing like "fail-start-up" with team who refuses to change password "password" over 4 years arguing that other companies does the same :-) - Happened for real, and not only with this, there is nearly 2.000 technical issues I was not able to change. – Andrew Smith 12 years ago
Common sense answer, as I know little to nothing about VC...
Are you building a team just to attract investors? Shouldn't you be building a team the way in which it is best for your particular business?
Wouldn't smart investors recognize that?
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Yes and no? Some investors require a business plan, some don't. My goal is to build a strong team of course, but sometimes investors look at things that maybe I wouldn't have thought of. That's why I posted the question. For the most part I'm just looking forward and trying to arm myself with as much information as possible. Until looking at Angelist, I wouldn't have thought about advisors, etc as really being part of my team to present to an investor. – Derek 12 years ago
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Advisors are different, you were asking about fulltime employees as well (at the end of your question). That is what my answer is directed at. – Ekoostik Martin 12 years ago
