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I talk with many aspiring entrepreneurs about joining early-stage startups, whether in the food space or in the larger innovation arena. Oftentimes, these job-seekers approach the hiring opportunity in the same way they might a more traditional role with a larger company. Given the risk inherent in joining a startup, where the future is far from certain, it's perilous to forgo a more in-depth examination of a startup's prospects before jumping on-board. Whether because a job seeker is enamored with the mission or vision for a particular startup, or because an in-depth analysis can seem too direct or prying, it can be common to ignore these common indicators of startup health. But, if you find yourself in this position, you owe it to yourself and the company you are considering joining to tackle these thorny issues upfront.
Participating in a panel discussion last week at Venture Cafe on investing in food startups, a first-time entrepreneur asked about "deal breakers" when raising your first round of capital. While there are a lot of decision points that go into negotiating a deal, in general there are a few foundational elements to pay attention to.
It should go without saying that as a founder, you can’t afford a bad pitch. But, even more than that, you cannot afford even a mediocre or “all right” pitch. Time is too tight, fundraising too difficult, and the competitive pool too large (and getting larger every day). That crucial first impression can either open doors to your next raise, or send you back to the drawing board.
We’ve seen a lot of pitches at The Food Loft. Here are the common issues we see.
The relationship between investors and entrepreneurs is sometimes an odd one. Many are the stories of entrepreneurs who approach investors looking to raise money for a round they wanted to close yesterday.