A skilled investor never invests only in the “idea” of a startup because he knows very well that the strength of this chain, no matter how thick and seemingly solid, depends on the strength of each link. The dysfunctional team kills the most innovative ideas, and the professional team turns the most ordinary views into success. The secret of success lies in the characteristics of the startup team; if you are an investor, you should look at them differently.
1. Team experience
The presence of experienced members in the team is attractive to investors. At all stages of the project, these people inject their experience into their teammates and help them perform their tasks better so that the company reaches its goal faster. According to surveys, the most favorable performance is related to people with 4 to 8 years of relevant work experience.
2. Number of startup founders
Generally, to measure the success of startup teams, numbers are less important. So why should the number of founders matter, you might ask? The reason is that in a startup, communication between team members is essential. Each founder is one of the pillars of the startup team, and there should be a good balance between their hard and soft skills. The intelligent investor, on the day of the interview, will find out the agreement or disagreement of the founders with a few questions. It then decides whether or not to invest in a team whose founders are not like-minded.
3. The previous defeats of the team
Previous failures are the most critical factor in evaluating the startup team. Every time the team loses, it crosses off the list of one of the thousand paths that do not end in the goal. Business growth and development experts believe that entrepreneurs who have experienced failure have seen the pitfalls of entrepreneurship and are likely to learn from their experiences and choose a safer path. Of course, experience shows that those with many unsuccessful attempts on their resume are likely to fail in subsequent attempts. Therefore, as an investor, you should see whether these successive failures were caused by repeating the same mistakes or had another cause.
4. Hard skills
Knowledge and experience gained from employment or education are called hard skills. It is up to the team leader to decide on the technical skills of the team members. He is the one who decides what specialized skill (complex skill) each member should have or in what areas they should play a role.
For example, if the project’s goal is to design and build a mobile application, the team leader defines the background knowledge and hard skills required for each role. Then he looks for people with enough knowledge to perform the duties of each position. Usually, members of successful startup teams cover an excellent set of complex skills.
5. Soft skills
In addition to the necessary specialized knowledge and experience, investors also pay attention to the habits and personal characteristics of startup team members. Features such as teamwork spirit, problem-solving, leadership, effective communication, honesty, and time management lead to the growth and prosperity of the team. These are called soft skills. Defining these skills for each role and the whole set is the responsibility of the team leader.
Suppose you are in the position of an investor. In that case, we recommend you get to know their priorities during a conversation with the startup team members and understand how they adapt to different situations.
6. Powerful mentors
English author and businessman Richard Branson says, “No matter how smart you think or how innovative, ordinary or awful your new idea is, every startup team needs at least one good mentor .” “Someone who has been through the most difficult situation you can imagine.” So, one of the essential features of successful startup teams is having successful and experienced mentors. These people become team members’ beacons and play a vital role. As an investor, never forget this point.
7. working hours
The speed of change and progress in startup teams is high. These businesses usually start from small environments with small projects and rapidly expand their activities. Therefore, they need employees ready to work for a long time from the beginning. We recommend you look for teams with severe and concerned employees to invest in. The hands of these people determine the company’s success because they get discouraged later in the face of challenges.
8. Success in attracting customers
The goal of every business is to attract more customers. Because it is the customer that makes the team grow and earn more. Startups usually start with innovative and new ideas designed to attract the attention of investors and customers. Unfortunately, some do not follow the proposed plan or change it as soon as they sign a contract with the investor. So, one of the essential features of a successful startup team is planning to attract customers and commit to it. If you see things in the team’s portfolio that did not attract the customer’s opinion, it is better to stop and ask why.
9. Skilled leader
From the moment the startup project is launched, each team member and the whole team face micro and macro problems together on the project path. An experienced leader should be able to manage the situation, no matter how bad. These people must have tasted hot and cold. It means knowing the possible challenges and how to prevent or deal with them. Communicate well with team members, customers, and investors in the most challenging situations and keep them at ease. Most investors, especially those who are not very risk-averse, go to startups that are sure of the management experience of the team leader.
10. Education of team members
Working in startup companies is full of trial and error and is not learned in any school or university. However, most investors expect team members to have a bachelor’s or master’s degree. A degree is not necessarily proof of workforce proficiency but provides the basis for initial trust. Of course, the balance between hard and soft skills is still important. If the members of a startup team are too intelligent and experienced, they may not be willing to share their knowledge with the team. If they are too interested in their career, they may take all the responsibilities themselves, not trusting anyone’s work. , they do not have the spirit of teamwork and cannot communicate with other group members.
last word
Investors evaluate their market reputation, financial profit, and current achievements to evaluate legacy companies. But for startup teams that usually don’t have fame and achievements, it leaves the statistics and figures aside and works intuitively. The number of failures and the lessons learned from them, the experience of each team member, and the leadership that leads this team show to a reasonable extent, what the result of this investment will be.
Do you think there are other features that we missed in this article? As an investor or customer, what other characteristics do you pay attention to in startup teams?
