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Black cloud It’s happening on the horizon for startups and investors alike. Large companies have announced that they are quitting to invest in startups. Y Combinator is advising founders to extend the runway; And venture capitalists are preaching that startups must survive before they can grow.
While it’s easy to get overwhelmed by the current doom and gloom, investors should focus on what matters most: founders. The state of the world is going to make people at the helm want more support, especially from their investors.
We’ve been seeing value-based investing for a while, and now is the time to turn your values into action. Naturally, investors will have their own case to make, but losing the interest of founders can be costly.
Investors need to demonstrate consistency, transparency and longevity now more than ever. They should give priority to people, not profit, because the decline will take hold. Below are a few tips on how to best help your founders through this difficult patch.
Thrift requires investors to pay more attention to their founders, and that only serves to improve their relationship.
Consistency: Be an investor your founders know
Your creators chose you because of what you bring to the table, including your experience and how you communicate. When the road gets rocky, you have to prove to them that you’re still that person.
Unexpected changes in your behavior can scare off founders and make them feel like you don’t trust them. If you practice the hands-off technique and encourage them to make their own decisions, don’t suddenly start micromanaging. Likewise, if you only regularly check in with them monthly, don’t start asking for weekly meetings.
Judge the size of the relationship that best serves your founders. One of our companies is currently closing a round, and instead of chasing them for updates, I texted the founder simply saying, “Hey, I know this is hard. I’m here if you need me. If they want to reach, I will put the ball in their court.
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