Managing investors - Ranjith Kumaran
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Your investors backed you because you knew how to run a company. But now that you have backers, you spend all your time managing them—and none of it managing the business. How should you manage your board and your VCs? When should you give in to their well-intentioned suggestions, and when should you shut them down? How much oversight is appropriate, and how much is meddling? In this session, entrepreneurs who've been there share their tips for managing your investors.
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Managing investors - Ranjith Kumaran
- 1. Board Members What you need to know @ranjithkumaran
- 2. Ranjith who? Founded July 2004, still on board Raised $50MM in venture capital 175 employees 18MM users, 400K paid 2009 revenues: $15MM Founded January 2011 Raised $850K in seed 4 employees 50K users, 0 paid 2011 revenues... nah!
- 3. Board 1.0: Your board picks you Started YouSendIt in 2004 (incorporated) Knew my cofounders Knew 0 angel investors Knew 0 venture funds (Knew basically nothing) Number of term sheets in seed = 1 Number of term sheets in Series A = 1 I WOULD MAKE MORE PRETTY SLIDES BUT I’M RUNNING AN EARLY STAGE STARTUP…
- 4. Board 1.0: You learn about boards Types of board members Young guy Strategy guy Operational guy Deal / network guy Finance guy Nobody tells you about board management… I WOULD MAKE MORE PRETTY SLIDES BUT I’M RUNNING AN EARLY STAGE STARTUP…
- 5. Board 1.0: The independent Types of independents: Industry veteran Ultra-branded startup founder Scrappy startup founder Celebrity? Independent should be voice of reason I WOULD MAKE MORE PRETTY SLIDES BUT I’M RUNNING AN EARLY STAGE STARTUP…
- 6. Board 1.0: You learn about yourself Eg. I am a product guy More fashionable to have product guy at the top now Eg. I like viral distribution Not everybody gets this stuff Eg. I like freemium Not everybody gets this stuff Eg. I am interested in company culture UI, DNA, API I have many blind spots But the truth is the founder must first solve problems himself / herself I WOULD MAKE MORE PRETTY SLIDES BUT I’M RUNNING AN EARLY STAGE STARTUP…
- 7. Board 2.0: You pick your board Started PunchTab in 2011 Knew my cofounder for 5 years Knew my angels for 7 years Knew which VCs I wanted to work with (Still knew basically nothing) Number of term sheets in seed = 0 (handshake) Number of term sheets in Series A = ??? I WOULD MAKE MORE PRETTY SLIDES BUT I’M RUNNING AN EARLY STAGE STARTUP…
- 8. Board 2.0: No surprises = minimal management Board invested in team Business model = figure it out (product folk) Post-money = business as usual Truly helpful via Deep, relevant network Recruiting heat Independent is walking in your shoes I WOULD MAKE MORE PRETTY SLIDES BUT I’M RUNNING AN EARLY STAGE STARTUP…