From your experience, are there any similarities between the startups that succeed?
At least one of two factors should be present: either great team or really good timing related to a rapidly growing market. What I mean by good market growth is more than 50% per year. As for the team – each founder should be in the top percentile of the people in his area of expertise or should have the ability to get there).
What’s the worst advice a startup can get?
I think that would be „fake it till you make it”. That tactic should be used only in some last resort situations, or when there is nothing to lose. However, there is always something to lose, for example, your reputation as a trustworthy and good performing founder.
What are you looking for in a startup?
After five years of searching for projects, I must say that the most important thing I’m looking for is the right team. It’s nothing new, I heard about that many times, but only after some time you train your eye to notice small differences between possibly great and just mediocre founders.
When is the time when the startup can or should talk to VC?
They should talk as quickly as possible – to get some feedback, gather some know-how, as well as to start building a relationship. That relationship might be later very helpful. Especially during the fundraising. If you ask me about the right time to start fundraising with VCs I also suggest doing it before the time that the money is really needed. I won’t say what’s the minimum achievement that should be presented to VCs – it varies a lot depending on the type of business. VCs are generally able to invest in a pre-revenue company if there is some interesting technology being developed.
Is this the kind of fundraising for every startup?
Yes, but we should then define startups as an organization that is aiming for a quick increase in their value. Only such organizations are suitable for Venture Capital investments. Small companies without that potential won’t be interesting for VCs. Scalability is the key.
What is the best way to approach a VC fund?
Definitely through the warm intro. In the best case, such intro should be made by some market- or technology-specialist. It’s simple – when a person working for years in Ads comes to you and says that you must meet some brand new Ad-tech startup, you will make this meeting no matter what.
What should you think of before talking to VC?
Think that you are talking with them not only to make a good impression but also in order to learn whether they are possibly good partners for you for the next couple of years.
Write down some questions you would like to ask them during the conversation. Consider whether they might give you some useful feedback or market information, no matter if they invest or not.
What are some challenges of starting or running a business in Poland?
Definitely, there is still a bit of bureaucracy that must be done to run a business here. A good accountant and a good lawyer might be worth their weight in gold 🙂
Last but not least, If you could recommend one must-read book to a startup, what would it be?
If you can read just one then you perhaps will decrease your losses a bit thanks to reading The Startup Owner’s Manual by Steve Blank and Bob Dorf. However, you should read all the time in many fields. Just remember that it’s better to read fewer books but those you l read, read twice.
Marcin Fejfer, Investment Manager, Speedup Venture Capital Group