What do investors look for in a founding team?

You may have the best product idea in the world with the optimum market conditions, but this still doesn't guarantee investment. Investors are looking for reliability, credibility and execution - and this all comes down to the founding team of your startup.

Investors are looking at the jockey, not the horse. The first jockey they're looking at to decide whether to invest? That would be you, the founder.

Naturally, investors are cautious to put their time and money into startups. The statistics speak for themselves with the failure of new ventures: only [33% of startups make it to the 10-year mark](https://review42.com/what-percentage-of-startups-fail/#:~:text=90% of new startups fail,to the 10-year mark.), whilst [under 50% make it to their fifth year.](https://review42.com/what-percentage-of-startups-fail/#:~:text=90% of new startups fail,to the 10-year mark.) For investors, it pays to be cautious, which is you why you need to demonstrate that you are equipped to not only navigate the first 12 months of launching a startup, but beyond that.

Do you have passion?

Whether your startup is a side-hustle or is your full-time job, the reality is almost every entrepreneur is passionate about their product or idea, if they're willing to put time and money into it. But how far does that passion go? What happens if you hear 'no' time and time again? How will you face the push-backs? Are you ready and able to keep standing up again? Because in order to be viable to one investor, you're going to have to hear 'no' a lot from the others - unfortunately, it's the reality of the game. But with every fall, you should be coming back stronger and with more gusto to prove the other investors wrong.

Tom Bradley, a partner of Oxford Capital - the investors behind Moneybox and Curve, told UKTN:

“We love teams who are really strong on the ‘why’ of their business. Founders with a powerful mission tend to do better in riding the emotional roller coaster of ‘doing a startup’, and tend to be more flexible in their tactics.

Founders who focus on the ‘what’ and the ‘how’ tend to find their thinking challenged, and often struggle to adapt to what the market is telling them.”

Can you do this?

Competency is the next thing investors are going to be looking for. Not only do you have to have capability, you need to have the ability. The skill. Are you confident in yourself and your own abilities? Do you have a co-founder with contrasting abilities to cover all skillsets?

Having a co-founder that covers the skills you don't have will make your startup far more appealing to an investor. Founders who don't recognise, or aren't willing to bring on somebody to fulfill the skills they lack are a big red flag to investors. If you're a technical founder, how can you convince investors that you know how to conduct thorough, market research? Or that you're able to put together a business plan. Likewise, if you're non-technical, how do you demonstrate you ability to build a technical product, if you've never undertaken this role before?

You might be a first-time founder, but do you understand what it takes to actually take an idea and turn it into a successful product, worthy of your investors' time? You need to demonstrate your ability to do all of these things in order to prove the worth of yourself, and your product, to an investor. The best way to do this, is by bringing somebody else on board.

Are you (and your team) willing to learn?

When you bring an investor on board, you're listening to another perspective on plans, strategies and the goals of your business.

A willingness to listen and learn is essential, especially when you're in a dynamic industry such as tech, the investor needs to know you're open to new methods and advancements to avoid stagnation of your product, or being left behind. Adaptability is key, and knowing and understanding the founder-investor relationship will hopefully prevent too many clashes.

Showing growth as a team and identifying your journey is a great way to get investors on board. Providing them with a background demonstrating growth, skill and accountability proves to investors that not only are you willing to learn, but you've applied what you've learnt to succeed.

Are you a tech startup or founder? Are you trying to build a viable product that investors will be interested in? If you're looking for guidance on starting your journey to becoming investor-ready, reach out to me on Linkedin or email, alex@thetechgorge.com.