Investors Turn Founders into Insecure Little Teenagers

Many founders lose confidence when they meet with investors. In their quest for validation, their entrepreneurial courage goes out the window.

Founders often believe investors have all the power, so they accept bad advice and make promises they can’t keep. But when external forces are the key to a company’s success, that’s a red flag.

Here’s a simple piece of advice:

Stop worrying about whether investors like you. Instead, decide whether you like investors.

Want to rebuild your confidence? Reclaim some of your power. Investors don’t guarantee success—you do. It’s your responsibility to explore balanced, mutual relationships with investors, and you can’t do that if you’re always worried about impressing them.

Want more actionable advice on getting founders to back your startup? Download our free guide, Fundraising Hacks For Founders.

When you meet with investors, you need to...

Understand Your Goal

You’re meeting to explore the potential for a partnership—you’re not there to convince anyone to invest. Leave your powers of persuasion at the door. This isn’t the time to sell yourself or your company. Don’t sell anything at all. Just ask yourself, “Is there a mutual fit?”

Speak honestly. See if you like each other. You’re there to evaluate whether another conversation should take place.

Be Yourself

When founders try to impress investors, the opposite tends to happen. Most good investors can see right through your bullshit, so show them the real you. If you’re nervous, that’s fine—own it and move on. It’s also okay to acknowledge your weaknesses as long as you plan to address them in the future. Be confident that you have a solution, even if the solution hasn’t been implemented.

Want to know what happens when you’re not genuine?

• You lose the investors who are right for you
• You attract the investors who are wrong for you

And besides, you’ll never be the right investment for every VC firm. That’s just how things go. What matters is that you find the right investor for you.

Ask Questions

Investor meetings shouldn’t be one-sided conversations. You won't win a prize if you answer all of their questions.

Here are a few questions you should ask early on:

• If we ever run into a problem, how would you interact with us?
• What should we expect from you if we’re not hitting our numbers or the market shifts? What do you expect from us?
• Which of your investments are you most proud of and why?
• What other questions would you have about this partnership if you were in our shoes?

When investors make suggestions or provide advice, don’t forget to ask follow-up questions. For example, if they say something like, “We think you need AI in this software,” ask, “What do you mean when you say AI? Why do you think it’s a good idea?” Ensure you have as much context as you need to respond confidently and clearly.

Listen carefully to their answers. Pay attention to how they respond to your questions. What does your gut tell you? Are they genuine or just telling you what they think you want to hear?

Gather as much information as you can. You don’t want to decide without knowing everything you can about how investors operate and their expectations.

Push Back

You’re the only one who can help investors understand your business, so don’t be afraid to push back. When someone suggests, there’s nothing wrong with saying, “I don’t think we should do that for these reasons,” or “We thought of that, but there are some considerations that could prevent us from pursuing this option.”

You’re not being rude or ungrateful—you’re just offering your perspective, which is highly valuable since you know your company better than they do.

Be a founder who can push back and be open-minded. Be a founder who looks for feedback and advice but who can make the company successful with or without investors.

When investors yell, “Jump!” you don’t have to say, “How high?” Just because they send an email doesn’t mean you have to reply immediately, especially if you’re working on something more pressing.

Pushing back, when appropriate, allows investors to interact with the real you. For example, in my early days as an entrepreneur, I received an email from a potential investor that read like this:

Sounds cool, right? But if you’ve interacted with investors in the past, you know they probably just wanted to schedule a call with a junior associate, who would ask a million questions and have zero decision-making power. I have nothing against junior associates, but even back then, I wasn’t in the mood for that conversation. So I said:

Thanks for reaching out, Stacy. I’d be happy to jump on a quick call with Travis sometime this week. Thursday or Friday would be best.

She replied:

Nope. So I wrote:

To which she responded:

Totally reasonable, but that didn’t work for me. So I said:

She made another attempt to convince me to speak with the associate first, but I didn’t respond. Finally, a few days later, Travis, the senior partner, sent me an email:

You’ll feel less anxious about investor meetings when you understand they are two-way streets. If they can’t meet you halfway, if they’re unable to see things through your eyes or get hurt when you push back, they’re probably not the right investors for you anyway.

Investors are People, Not Gods

You must dispel the myth that investors can make or break your company. They’re humans. They have pressures, commitments, rationales, and biases just like the rest of us. Their goal is to make money—they have quotas and goals, too.

Ultimately, investors are bankers. They provide cash so that you can run your business more effectively. They expect, if nothing else, a return on their investment. The relationship is fundamentally transactional.

Investors aren’t magicians, and they can’t guarantee your success. So it's important that you've already considered alternative funding options (like bank loans, securing a high-limit business credit card, a loan from friends and family, or otherwise) if having investors on board for the long haul doesn't sound like your best call.

Success is Your Responsibility

Investors can accelerate growth, but they’re not the driving force behind it. If you decide that an investor makes sense for you and you can work together to strengthen your company, go ahead and pursue that partnership. But it’s primarily on you to evaluate their value, not vice versa. The success of your company doesn’t depend on anyone else.

By being authentic, asking insightful questions, and pushing back when needed, you can build healthier, more balanced relationships with investors. They are not the key to your success—you are. Evaluate each opportunity carefully, and if the partnership makes sense, proceed with clarity and confidence.