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Launching a tech company is a long and winding road filled with ups and downs, and every entrepreneur must make some significant decisions along the way. Here are some tips for startup founders from entrepreneurs who turned VC, as well as the primary "don'ts" that make an entrepreneur's journey easier.
Any startup's most valuable asset is its team. The product, the market, and the regulations may change, but if your team members can adapt to new circumstances, don't panic, and work in uncertain scenarios, your startup is likely to survive. Build close relationships with competent experts in your area by investing your time, money, and expertise. Your team of like-minded people will be there for you no matter what occurs. That implies some compromise. Remember to be responsive to criticism. It's difficult, but the individuals you deal with must feel respected and heard. That is why they want to be able to communicate clearly and honestly with them.
As a speaker or listener, you don't need to waste time visiting dozens of events. First of all, it mostly feeds your ego. You're afraid of missing out in the second scenario. None of them are beneficial to a business owner. Covid has taught us to engage in a variety of social contacts online, so try to budget your time wisely and set up first meetings online. Attend a few offline events where you can learn new skills from actual professionals and meet people who could become valuable members of your network.
This may appear daunting, but a venture capitalist must have a founder that is solely focused on their startup. Of course, there have been occasions where successful young entrepreneurs worked on two or three projects at the same time or even had a full-time job while working on their own startup. These are exceptional circumstances. VCs do not take these examples or rules into account. If you want others to give you money and believe in your ability to build a big company, you must decide whether you are "all in."
VCs will only examine investment offers that are likely to reach their 10x return on investment goal. The timeline for such a return must also be realistic. It should not last more than 5 to 7 years after the investment. Good contract conditions are equally important, so we must consider a mix of the investment amount, the pre-money valuation, equity ownership, potential dilution, acquisition purchase price, and other factors. For a long time, the founder and the investor will be in the same boat. As a result, it's critical that they grasp each other's motives from the start.
You must learn to inspire others with your long-term goals. Actually, this is the primary distinction between a successful fundraiser and one of many. Such founders can sell exclusivity and involvement in molding history. Do you think the NASA janitor played a role in landing a man on the moon? The same reasoning applies. Do not just sell the current status of the company; persuade VCs that you are a game-changer and that you can carry out your vision.
Working on your project 24 hours a day, 7 days a week, you're bound to make mistakes. Venture investors can help you get your feet wet. They are professionals who review hundreds of startups each month. They're there to give you a different perspective. Make the most of it by asking questions. And it's completely free, so take advantage of it. It can occasionally provide you with new business ideas and insights. It can sometimes assist you in determining how to strengthen your pitch and make meetings with other VCs more productive. Prepare a list of questions ahead of time and be as curious as possible. You'll be astonished at how eager individuals are to give their opinions and provide comments if you ask.
Always keep in mind that the product for a venture capitalist is the company itself, not what it produces or sells. Investors are customers who purchase a product intending to find another consumer and earn multiple times their initial investment. The founder's responsibility is to market the product and use all available tools and guidance to seal the deal.
These are the seven core principles that have guided my years of entrepreneurship and investment. They are straightforward. They make sense. And believe me when I say that if your startup succeeds, you will eventually come to the same conclusions. I've always appreciated the helpful advice I've received along the road. They have led me to these suggestions. I hope that these tips for startup founders are the kind of relevant guidance that makes a significant impact on your entrepreneurial journey and gets you to the success you desire and deserve.
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