Before Reporting to Investors, Think Through Three Questions

When something happens, founders should not rush to report—or show off—to investors. Before approaching them, think through three questions: 1. Why did this happen? 2. How can it be solved, and how many possible solutions are there? 3. Which solution do you think is best, and why? Only after considering these should you report to investors. Unless it is an urgent crisis, do not rush to speak before thinking. ----- Robin: ‘It depends on the investor too. Investors do not like being contacted only when a crisis is already urgent. But thinking through the problem and solutions before approaching them certainly creates a better impression. Do not let the solution be merely asking investors for money, or imagine that money will solve everything. Taking investors’ money is not the best way to solve problems, and relying on it alone does not help founders develop. An investor’s greatest hope is that the portfolio company sails smoothly after investment and grows well without much worry. Ideally, every discussion concerns pleasant burdens: we are growing too fast and need more people; we have received an enormous acquisition offer; several exchanges want us to list, so how do we choose...?’