Venture Capital

‘Great founder’ and ‘Big market disruption’ are stories that get investors excited

By September 24, 2013 No Comments

The infographic below was on Venturebeat this morning. It sets out six ways in which companies present themselves to investors. If you are an entrepreneur you should think which one best matches your company. In my experience it is the top two that work best for fundraising:

  • Disruptions of big markets are easy to get excited about
  • Great founders make you want to back them
  • However, an all star team is obviously not a bad thing, but companies need leaders.
  • Similarly, complex business models (aka ‘the detective’) are tricky for investors who don’t have deep domain knowledge.
  • Services which ’emancipate’ consumers by making their lives magically better are very cool when they work, but the problems are not new and most of the low hanging fruit has been taken.
  • Finally, companies which exist primarily to make the world a better place are very worthy, and I’m glad they exist, but they generally don’t sit well in the portfolios of VCs whose raison d’etre is to maximise profits.