Editor’s Note: Here’s a story from our archives we feel is relevant even today and deserves your attention.
Golden Gate Ventures (GGV) and East Ventures (EV) are two influential VCs based out of Singapore whom entrepreneurs rely on for mentorship, talent access and possible acquisitions through the VCs’ extensive global network.
GGV and EV have been Startup Blueprint partners since the programme was launched in Asia Pacific a year ago.
I caught up with Jeffrey Paine, GGV Founding Partner and Willson Cuaca, EV Co-Founder and Managing Partner, on separate occasions to talk about their firms. We chatted about how they are helping the startup community.
It is common for them to receive thousands of investment proposals and recommendations each year. They pour through these and interact with numerous founders with the goal of uncovering The Next Big Thing. They have each formed their own thesis on the characteristics of founders who have the material to be moulded for greater heights.
These five characteristics are
Time is precious for both entrepreneurs and VCs so the first meeting sets the tone for further interactions.
“I’ll expect the founders to be themselves, tell us the founding story, show the traction,” said Cuaca on his expectations for first founder-investor meetings.
“The product doesn’t matter and many a times the startup won’t have a product in the early days. What matters most are the founder’s traits such as being honest, patient and having a vision. Don’t cheat, lie or bullshit. It’s easily discoverable if you do,” he added.
Focus on the tangibles
In contrast, Paine focusses on the tangibles in the first meeting.
“The first bar to entry will be a prototype regardless of whether it’s private beta or publicly used. This shows the founding team is able to execute. My own fund research data shows that 97 per cent of the top 35 startups in Southeast Asia are clones. Hence, execution is preferred over presentation slides and ideas on a napkin.”
Show your resourcefulness
Both Paine and Cuaca echoed the same sentiments towards resourceful founders.
“Founders should have an unfair advantage of domain knowledge above the rest. Either they’re from the domain or they’ve figured out the drivers, challenges, current situation and alternatives after an extensive period of study. Resourceful founders ask weird questions that people normally don’t ask to test out their hypothesis,” said Paine.
Cuaca reiterated this view by adding, “Great founders are highly resourceful which translates into great problem-solving skills. They do not come up with excuses. You can quickly see their progression as their knowledge base grows.”
Don’t be afraid to fail
“Unsuccessful founders often hide when they do not perform. They do this because they don’t recognise that they’ve failed. It’s hard to help them this way and this ties back to my initial point on founders being dishonest. A large number of founders underperform because they flip-flop on issues and become indecisive on business decisions,” said Cuaca.
Paine pointed out that being unfocussed is the fatal error.
According to Paine, “Founders have to be committed when starting new things and be 100 per cent focused on it. Most people are risk-averse and try to juggle a few things at the same by doing things on the side.”
Think small, aim big
Cuaca highlighted that targetting a sizable market and the founder’s ability to scale are important.
“Target a single big market for dominance first before regional expansion. Multiple market launches at an early stage like Rocket Internet might not be wise due to huge upfront capital costs. Secondly, the rapid knowledge growth of founders is more important than what has been achieved in the past,” advised Cuaca.
Paine added, “Founders and their teams have to be detailed and adept in product metrics, marketing and distribution and understand analytical tools.”
If you are thinking of reaching out to Golden Gate Ventures and East Ventures to pitch your business ideas, here are some pro-tips:
- Do not be discouraged if investors think your plan needs more work.
- Ask for permission to continue engaging with the VC through regular investor updates.
- Be genuine and stick to your words.
- Whiskey is the favourite drink for Paine and the GGV team.
The views expressed here are of the author, and e27 may not necessarily subscribe to them. e27 invites members from Asia’s tech industry and startup community to share their honest opinions and expert knowledge with our readers. If you are interested in sharing your point of view, please send us an email to writers[at]e27[dot]co