How can you build relationships with founders while maintaining objectivity?

Transparency in venture capital not only builds trust but also aligns expectations, reducing the risk of investment friction down the line. Honest feedback, even when critical, can be invaluable to founders, helping them to pivot or iterate their business models effectively. Moreover, clear communication about investment criteria and processes helps founders navigate the fundraising landscape, saving time for both parties by focusing on the most promising and mutually beneficial opportunities.

As a seasoned VC expert, I've found trust as the cornerstone of any successful investor-startup relationship. It forms the basis for effective communication, collaboration, and long-term partnerships. Building and maintaining trust requires transparency, reliability, and a commitment to mutual success from both parties. During my work experience, every time I managed to build a successful trustful relationship with an investment case, the final result was more satisfying.

Setting expectations 1) aligning visions - are we the right fit 2) founders tend to flock to VCs who historically have been founder friendly / just; not taken advantage of founders 3) deal sheets generally have standard terms ( eg NVCA template) ; walking founder through terms such as drag along provision , liquidation presence; these are important as many startups don’t understand the importance of such terms for VC

My approach to maintaining a balance of trust & objectivity in founder relationships is based on a personal belief system centered around simple, radical transparency: Say what you mean. Do what you say. Clear communication about process, goals and criteria facilitates engagement and mutual buy in. The hope is founders will return this honesty and that reciprocity becomes the foundation of a healthy, productive dialogue. The unfortunate truth is many founders- especially first timers- either don’t know how to be transparent or value superficial concepts like “spin” and “FOMO” more. Typically, I avoid these founders but if that’s not an option then I will have an open, respectful talk about consequences and then enforce these over time.

Building relationships with founders while staying objective is all about balance. You can be friendly and supportive, but always remember your professional role. Listen to their ideas and offer honest, constructive feedback. It's important to show that you care about their success but also be clear about what's realistic and what isn't. Keep regular communication, but base your decisions on facts and data, not just personal feelings. Respect their vision but don't hesitate to ask tough questions when needed. This way, you can have a good relationship with them but still make decisions that are best for the business. #ProfessionalRelationships #Objectivity #FounderEngagement

Building relationships with founders while maintaining objectivity is a delicate balance. In my experience, being curious and empathetic is key. Show genuine interest in their vision, challenges, and achievements. Ask insightful questions to understand their business and personal motivations. This builds a rapport based on mutual respect and understanding. However, it's crucial to maintain professional objectivity. While being supportive and empathetic, also be clear about your role as an evaluator or advisor. This approach helps in creating strong, trust-based relationships with founders, which are essential for collaboration, without compromising the objective assessment needed in professional settings.

Ask open-ended questions, actively listen, and acknowledge their journey and emotions. Avoid judgment and imposition, fostering a deeper understanding and building crucial support and motivation.

Show genuine interest in what others have to say. Create a safe space for constructive criticism and dissent. Foster a culture where everyone feels comfortable sharing their perspectives without fear of judgment. Open-ended questions help to encourage brainstorming and diverse viewpoints. Always lead by example: demonstrate open communication, be approachable, accessible, and responsive to inquiries. Encourage others to do the same.

This is a two way flow, founders equally need to be cognisant of why they are talking to investors. But allowing for a quick intro can be beneficial but even with a quick response on thesis and key priorities can help manage whether a relationship is worth building now, or more for future.

Building relationships with founders while maintaining objectivity involves being selective and strategic. In my experience, it's important to engage with founders whose businesses align with your professional interests and values. This selective approach ensures that the relationships you cultivate are purposeful and relevant to your goals. Be strategic in your interactions, focusing on how you can provide value through your expertise, network, or resources, while also understanding the founder's vision and challenges. Balancing this strategic approach with professional boundaries helps maintain objectivity, ensuring that your involvement is guided by business rationale rather than personal bias or attachment.

It is very likely, that founders will actually know the space they operate in better than investors (since most investors are generalists). It is also highly likely that an investor would do an inferior job at building the same company. Therefore, being humble and approaching a situation assuming that one will learn something from the interaction is typically a smart decision for investors.

O mais importante é ter empatia e entender o contexto, quando você passa a acompanhar um empreendedor por mais de 2 anos, fica fácil identificar os padr?es, entender o jeito dele de pensar, pegar aprendizados do passado e conseguir ajudar de forma mais personalizada, específica e melhor.

Let's cut through the feel-good narrative: nurturing relationships with founders while clinging to objectivity is like taming a lion. You appreciate its strength, but you're always aware it might bite. You need to be a part-time believer in their vision, but a full-time skeptic of their methods. It's about challenging them, not just championing them. Remember, in the startup world, the line between visionary and delusional can be razor-thin. Your job? To be the voice that keeps them grounded, not the echo that amplifies their dreams uncritically.

Many founders will believe that their way of doing business is the only way, so being able to balance their self confidence and the need to introduce new ideas, can be a difficult task. Try not to dominate them because this will only lead to friction and a short lived relationship! My advice would be to listen, discuss and if necessary, agree a plan for positive change. If not, move on! Not all founders will be driven by the same personal values. Take time to understand theirs and accommodate them in your advice. Steamrolling the very foundations of their business life is never a good idea!

Foster solid relationships with founders by embracing balance and fairness in evaluations, terms, expectations, and involvement. Strive for moderation, steering away from extremes. This approach facilitates sound decision-making, the negotiation of mutually advantageous deals, the setting of achievable goals, and the promotion of effective collaboration for shared success. Remember they are human too!

Atividades fora a rotina da rela??o investidor e investida podem ser ótimas para desenvolvimento de confian?a e aproxima??o. Mas é preciso saber separar os momentos em que é necessário ser mais duro e pressionar para ajudar o founder a focar, e os momentos mais passivos para escutar e deixar rolar. Ir para a arquibancada faz parte do jogo. Ir apagar um incêndio também. O importante é respeitar sempre a decis?o final do empreendedor e entender o contexto ao longo do tempo para atuar de forma mais assertiva.

In my experience, clear and consistent communication is not just about avoiding misunderstandings, it's about building trust, fostering collaboration, and ultimately, achieving success. Hence, it is important to adapt to each audience's preferred channels and tone of voice. Adjust your language accordingly. Formal with investors, collaborative with portfolio companies, and engaging with potential founders. Remember, authenticity matters!

In my experience there is a disconnect often between the Founder investor relationship. Which is not triggered by fault or malicious intent, simply it's a loss of perspective of what each other is trying to achieve within the terms of the deal. Founders - looking at follow on investment may not understand where their current investors sit in thesis or follow on capital ability. OR be aware of fund lifecycles at the start of the conversations to be aware of how much time should be dedicated to each investor. Investors - generally have a key focus on providing returns to LP's and can often end up quietly quitting if they mark a startup as a washout on the fund return. Clarity about expectations and direction of travel can be beneficial.

Be helpful. Relationships between VCs and entrepreneurs are often longer term. Even when there hasn't been an investment (yet?), the relationship is being built. Opening doors for impressive entrepreneurs with people I know, and keeping my own door open are important examples of being helpful. The same is true in the other direction: I appreciate entrepreneurs that are helpful to others. I have so much to learn from brilliant entrepreneurs - it's one of the best features of being a VC! Obviously, entrepreneurs are busy and their time must be respected, but sometimes in a few minutes they can make a big difference for someone.