How founders can effectively engage their investors

Investing is like "professional marriage", once someone is on your cap table, both sides are now in it for the long-haul. VC investors are no doubt a source of capital. However, in early-stages of a company money doesn't solve all problems and founders should consider engaging their investors beyond capital.

Here are some of the reasons why founders should deeply engage with their investors

1. Incentives are aligned: Investors and entrepreneurs benefit only when the company grows. Especially in early-stages when a lot of things are still being figured, the risk of mortality is high. Hence, investors and founders are equally incentivized towards solving these?issues.?
2. Outside-in perspective: Founders are in the weeds everyday solving problems and paying attention to details. It is easy to miss the forest?for the trees. Investors can be an objective sounding board while the operating team is sometimes at the risk of drinking their own kool aid.?
3. Ability to zoom out: Prioritization is very important in early stages when a?lot?needs to get done and time and bandwidth is limited. Investors can help think through what creates the most impact to direct resources towards, and help balance entrepreneurs' tendency to try to fix everything at once.?
4. Best practices from other startups: In business, often one problem can have multiple plausible-sounding theoretical?solutions. However, trying each to see which is effective can take up a lot of resources and time. Investors can help with what works in similar circumstances in other companies and help short-circuit the trial-and-error.?
5. Contextualizing progress: It is easy to mistake movement for progress. Even when there is progress, it needs to be viewed from a lens of the market, because a company doesn't exist in isolation. Investors can help you view progress in this backdrop and keep getting you much needed reality checks.?
6. Strategic & operational problem solving: You can leverage your investors to discuss issues from analytics to strategic decisions. Investors make for great sounding boards and help entrepreneurs structure their thinking.?
7. Access to network in ecosystem: Investors often have strong networks, via portfolio as well as having to meet multiple people in the course of their work. They can leverage this for your benefit, from tactical advice for specific?issues to help hire.??

Here is how we typically try to engage with our portfolio companies

1. Regular discussions: We engage with companies as frequently as weekly to drive various areas. The idea for each discussion is to deep-dive into a specific topic e.g. channel-expansion and go deep in it. We typically have a differentiated agenda for different discussions e.g. BOD for strategic discussions vs working sessions for operational details
2. Benchmarking performance: Based on a diverse portfolio and investing experience of the team, we are able to benchmark performance, esp functional, across the portfolio to identify areas to improve. Ranging from courier partner rate cards to checkout percentages.?
3. Ecosystem of partnerships: We have a network of functional experts ranging from supply to GTM, who can help the company navigate specific problems. We also have built a set of partnerships to enable our portcos to offer specific benefits ordinarily not accessible to early stages companies.?
4. Inputs on org building: The hardest thing about scaling fast is having the right org in place in a timely manner. We help companies think through what org they will need well in advance. Additionally, we help companies with evaluating candidates, ref checks, and well?as sourcing strong profiles.?
5. Reinforcement of cultural values: We help founders drive home priorities and values with the team via org interventions such as town halls. Having a third person perspective helps the team appreciate the importance and criticality of the mission.?
6. Future fund raises: We are able to introduce our companies to late-stage entrepreneurs early on so that they build towards future raises and everything is easy and ready when the company does in fact decide to raise.?

We believe that by actively getting involved increases chances of success and brings rigor to company building. At the same time maintaining a balance is important. Investors should intervene at critical moments and add value but also not micro-manage. We have been privileged?to partner with founders with whom we have built great outcomes.?