The Full Ratchet (TFR): Venture Capital and Startup Investing Demystified
Investor Stories 1: Why I Passed (Brad Feld, Ann Winblad, Gabriel Weinberg)
Sep 17, 2014
Investors Brad Feld, Ann Winblad, and Gabriel Weinberg discuss why they chose not to invest in a startup. Topics include the importance of open communication, lessons in due diligence from a missed investment opportunity, and the significance of the first email interaction with investors.
11:35
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Quick takeaways
- Evaluating the CEO's long-term suitability and effectively communicating concerns is crucial in investment decisions.
- Crafting concise and compelling emails is crucial for entrepreneurs to capture investors' attention and secure funding.
Deep dives
Bradfeld's Evaluation of a Startup
Bradfeld shares a story of evaluating an early-stage startup led by a professor and a co-founder. Though he liked the core technology and the team, he was hesitant about the CEO's long-term suitability. Rather than playing games, Bradfeld communicated his concerns and the negotiations started to collapse due to various issues, including team dynamics and IP ownership. Ultimately, Bradfeld gracefully withdrew, paid for their legal fees, and the startup dissolved six months later. Despite not investing in that company, he was pleased that the professor went on to start a new company based on her research.
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