Zach DeWitt
After winning the 2013 TechCrunch Meetup and Pitch-off, I decided to drop out of business school to pursue my startup full time. Two years and two award-winning iPhone apps later, we ultimately decided it was time to sell our technology to Snapchat.
At that point, I went back to Harvard to finish up my MBA, and after graduation, I joined an early-stage venture capital firm based in Palo Alto.
Through my startup experience and having now invested in more than 10 startups with Wing, what I’ve come to learn is that finding the right venture capitalist for your startup is one of the most important decisions you’ll make. In many ways, it’s like finding the right spouse.
A great VC will do so much more for you than just write a check. You want someone with a high degree of empathy and curiosity who will ask the right questions and challenge you, while also being a shock absorber for bad news. VCs should never give armchair product advice nor cross the line into micromanagement.
The best founder and VC relationships are based on trust and partnership; it should be a relationship that’s nonjudgmental, supportive, and constructive. As many founders can attest, the startup journey can be lonely at times. Having a true partner to help you steer the ship when the sailing is smooth or otherwise can be a game-changer.
Here are some pieces of advice that I’d give to founders about how to choose the right VC and get the best out of the relationship.
Choose someone who can help with your blind spots
As a founder, it’s easy to get bogged down by details. In my case, I was so focused on the product experience that I didn’t think through other strategic initiatives like marketing, partnerships, or, at times, fundraising.
For example, it was only after being prompted by an investor that I started putting time and energy into strengthening my relationship with Apple to get our app featured in the Apple Store. This App Store feature changed the company’s trajectory, and it came as a result of an investor making an introduction to Apple.
VCs often have the advantage of not being as embedded in your startup’s technical and operational details as you are. Each year, they meet hundreds of companies, giving them unique intel on your market and the competition. This positions them to anticipate potential obstacles and issues that you may not currently be focused on.
Don’t be afraid to share bad news
Sharing bad news is just as, if not more, important than sharing good news. Founders are often inclined to avoid or delay sharing information that they think will disappoint their VC, but in doing so, they miss out on leveraging the VC’s resources and experience. As a founder, I certainly could have done a much better job with this.
If you have a healthy partnership with your VC, not only will they expect some bad news, but they’ll even welcome it, as they will be keen to provide you with connections, resources, and data to help navigate challenging times.
A pivot is not a bad thing
When I was at my startup, I found myself nervous about deviating too far from the road map I’d shared with investors. After all, they invested because they liked the road map, right?
In reality, they invested in us because they believed in the team and the vision, regardless of the implementation details. They wanted us to find creative solutions to our problems.
This hesitation prevented my relationship with my investors from being as productive as it could have been. If I’d told my investor six months earlier, “Hey, we haven’t found product-market fit yet, so I’m thinking about pivoting,” it could have positively transformed the trajectory of the company.
VCs should work to earn your trust
Consistent communication is important, but it’s not just a matter of throwing a recurring meeting on the calendar. Feeling like you have to update a VC every other week isn’t productive or enjoyable.
As a founder, you are working around the clock, and your time is valuable. A good VC will work to earn your trust by helping you in many ways behind the scenes. Don’t be afraid to put them to work and speak up for yourself if you are getting bogged down with too many check-ins!
Think beyond the check
So you’ve raised money. Now what?
There are plenty of ways VCs can support early-stage startups beyond raising capital — for example, by helping founders build their team, bring on advisers and marketing partners, execute a go-to-market strategy, and close early customers. Founders shouldn’t hesitate to push their VCs here — I love when founders ask me to talk to a potential hire to help sell them on the opportunity and company vision.
Just like your VC should push you on complex issues, push them on the tough questions: Are there people you can meet who have done this before? What potential pitfalls are you not seeing? How will a future investor assess your progress?
In conclusion
As a first-time founder, I was hesitant to ask for help and advice because I didn’t want to give my investors the perception that I didn’t know what I was doing. It wasn’t until I got over this and began asking for help that things started to click for my startup.
I wish I had worked harder to deepen my relationships with my VCs earlier, as they proved to be a tremendous support system once I did. I am grateful to the investors that bet on me and for all of the tremendous help that they provided along the way. Without a doubt, they made me a better CEO and made the company better.
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