One of the many advantages of raising venture capital is that, as a portfolio company, you have access to the firm’s network. In other words, you can now ask experienced founders and operators as many questions as you’d like.
But what if you haven’t raised funding yet? What if you’re in the earliest of stages and you still have plenty of questions for the venture community? That’s where we come in.
Last year, we sourced a handful of questions from the Chicago startup community, such as what are the most important slides in a pitch deck and should I use a broker, and asked three local VCs to tackle them. Here are the first next three questions in the series.
We’re a startup with good traction and solid GTM, but something every VC seems to push us back on is – we have six founders. Does that concern you? (Answered by Ty Findley, Sr. Associate at GE Ventures)
Unfortunately, six founders are simply too many. Two, maybe three, co-founders with very complimentary skill sets is ideal. Beyond two to three a couple of key issues come to mind, among many others. First, who is calling the shots? Startups need to move quickly, and with that many voices around the table, decisions can take much longer than they should for an early stage company; your board certainly will take issue with this. Second, with that many founders the dilution of company ownership is an immediate concern. Early stage investing requires long-term planning to keep management team incentives carefully aligned with their investors, and if you have already split the ownership 6 ways, an investor will be very concerned that the right incentive is…