The type of risk I’m looking for
If all good businesses are the same and an investor’s job is to buy risk, investors are differentiated by the type of risk they are willing…
If all good businesses are the same and an investor’s job is to buy risk, investors are differentiated by the type of risk they are willing to buy. So what type of risk am I looking for?
If most startup risk can be assigned to either Team, Product, or Market, I’ll take Product Risk any day of the week.
Why? Because if people don’t change and markets either exist or do not, product can be envisioned, spec’d out, and refined over many iterations. I don’t need to hold it in my hands to understand that it’s possible and I certainly don’t need millions of users to validate that it’s a good idea.
This is where I, as a tech entrepreneur who has built software used by millions of people, have an edge over the finance guys turned VCs. I can go earlier and see through what they perceive as risk. They’re probably better at analyzing cash flow statements but I have experience evaluating technical plans and building products. I’m no Woz, but I know enough to know that “big data” and “AI” aren’t going to solve all of your problems. Conversely, if your technical with a track record, I’m not worried about your ability to string a few APIs together.
At the end of the day, my job is to provide risk capital to get high tech ventures off the ground. Thus, there’s no such thing as “too early” in my book. That’s not to say that I’ll fund anyone with a halfbaked idea, just that I’m very willing to fund two kick ass gals with a killer idea in a big market and the right plan and expertise to execute on it. The limiting factor will probably be getting to know you and your market, not how much product you’ve built.