https://memeseeker.files.wordpress.com/2013/01/ocean_happy_january.jpg
Nope, not what traction they have.
Nope, not TAM.
Nope, not about the product.
Nope, not even about the team.
Angel investors, those who often invest in first-time founders at the very early stages of their entrepreneurial journey, should ask a completely different question.
Drumroll, Please…
The #1 question angel investors should ask founders is:
“Do you know just how hard this will be?”
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Do you know how many 16 hour days, sometimes 7 days a week, this will take?
Do you know how many birthday parties, Sunday nights and soccer games you’ll miss?
Do you know how much crap you’ll have to deal with? Taxes. Bad receivables? Employees stealing (possibly). Competitors acting in less than honorable ways. And so on and so forth for miles and miles.
Do you know that you committed to making me a return of at least 10x or 30x or whatever we agreed on (no, no in writing but when I the investor told you what my investment criteria are and you said you’ll make that happen)?
Do you know that I think it’s really not cool if you give up in year 3 when the “easy money” runs out and it’s game time so we’re in this for 5, 7 or maybe even 10 years?
David Cohen of Techstars talks about not giving up and honoring your commitment to you investors.
Ben Horowitz, now of a16z (Andreessen Horowitz), had this to say:
So remember, if you’re investing in untested founders make sure you know that they understand that this is years and years of extremely hard work in the most stressful of conditions. It’s not for everybody. For those of us who really love the work and enjoy (most of) the things surrounding it it is a truly great way to make a living (or loose your shirt).
But it is like this on every other day (if you’re lucky):
https://www.quora.com/Why-do-so-many-startups-fail
Jakub Kostecki provides automated due-diligence-as-a-service to early-stage investors using machine learning, predictive AI and other technologies to sift through startup investment opportunities and identify, select and vet those most likely to succeed. See StartupFactCheck for more details.
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