Start-ups 101

Here, we discuss what makes start-ups appealing to investors, which will allow you to better understand what funders loos for when evaluating companies.


Ideas are key to setting the company’s vision and to creating a compelling story around the start-up. While many companies end up pivoting as they develop their product, moving away from the company’s founding ideas and establishing new ones, creating a unified vision for the start-up is not only a good way to focus everyone in one direction, it also makes it easier to sell the vision of the company to investors.


Once you have a good idea, you build a product around it; this is what customers actually use or buy when they are interacting with your company. A successful company will be able to translate a good idea into a great product, and will listen earnestly to early users, taking into account their feedback and understanding how the product is being used (regardless of how it was intended to be used). Indeed, it’s not just the product that investors are examining. They also consider the product-market fit: does the product satisfy a demonstrable need in the market?


One of the most important success factors for any start-up is hiring the right team. The first few employees of a company will often make or break the company. Do look to hire only when you are desperately in need of new employees, and recruit from your personal networks first, asking your friends and acquaintances to put you in touch with high-performers they have worked with. Do not be afraid to give your first employees a relatively large chunk of equity, as they will be the ones who will make the company succeed, and do not be afraid to quickly fire people who are not working out.


Execution means putting everything together. This is the crucial aspect of the CEO’s job: making sure the team is focused, motivated and growing. It means managing the team in a way that maximises the employees’ efforts, and manages disagreements among team members. It also means setting clear, measurable goals so that progress and employee performance can be evaluated. Keeping these four components in mind is useful for all start-ups, and especially those that are looking to raise money, as investors will organise their thinking around the same themes – is the idea any good? How about the product the company built around this idea? What about the team? And how focused and motivated is the company to execute its vision?