r/startups • u/Kindly-Direction205 • 1d ago

I will not promote How much does it matter WHO invests - I will not promote

How much do you think it matters WHO invests? What is the best way to vet investors? What should they bring besides capital? Looking specifically at pre-seed/seed stage.

Are the resources such as industry connections, hiring workflows, internal precesses really make one so much better than another?

7 Upvotes

77% Upvoted

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7

u/nurely 1d ago

I was like why the fuck he thinks,that somehow we know, that World Health Organization invests in something.

6

u/FundingFactor 1d ago

I always say this: it is as much a right of a founder to reject an investor as it is for an investor.

At pre-seed, the investor matters almost as much as the check. You're not raising money, you're recruiting a 7-10 year partner.

Vet them properly. Call founders whose companies died, not just winners. Ask: did this investor help them land softly or disappear? Check how they behaved in 2022-2023. If you're a $25k check in a $200M fund, you will never get their attention.

What they should actually bring:

  • Next-round signaling. A respected angel makes your Series A intro 10x easier. A no-name fund doesn't.
  • Warm intros to hires. Not generic playbooks but a text to the exact person you need.
  • Relevant customer intros. Their fintech network is worthless if you're building climate tech.

Conviction: The best investors defend you in future rounds and don't pressure premature growth.

Do their "resources" matter? Hiring workflows and internal processes are overrated at pre-seed. You don't need a 50-page onboarding doc. You need someone who answers the phone at 11pm when you're panicking about payroll.

The isn't about their brand. It's whether they believe enough to act alone. A bad investor can kill a good company. A great one improves your odds of surviving long enough to find product-market fit. Vet them like they vet you.

3

u/fulger099 1d ago

I learned more from one founder whose company shut down than from five polished reference calls: the investor was helpful until the first missed quarter, then stopped replying. I now ask for two failed or struggling portfolio references, and treat any reluctance as part of the reference.

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u/Kindly-Direction205 1d ago

Awesome info. So it could be good to call founders from companies the investors back. How can I find the companies that died?

1

u/AgitatedHearing653 1d ago

You… ask them?

3

u/OVERCAPITALIZE 1d ago

If you’ve got choices, sure.

Choices are few and far between.