Building a Fundable Team
Investors, recruiters and entrepreneurs agree that startup success is based on three things: the team, the product/technology, and the market opportunity. But it is an often repeated truism that angels and venture capital firms invest in teams more than they invest in ideas.
The recent roundtable, “Building a Fundable Team,” provided investors’ perspectives on this dilemma, along with a discussion of other team-related topics, such as:
- What is a founder’s role on the management team?
- Is the current team complete enough for the stage of the company?
- Does the current team need someone to play an interim role to fill in a critical need?
We invited three experts to speak to the topic:
Glenn Champagne, a member of Launchpad Venture Group, with an 18+ year career in startup/early stage companies including Oracle, Business Objects, Eprise and InBoxer.
Dr. Omar Amirana, MD, a Partner at Oxford Bioscience Partners, who has helped raise over $60M in venture financing which resulted in three IPOs: EP Technologies, Cardima, and MedicaLogic/Medscape. He has held a variety of executive roles at early stage companies: CEO and co-founder, and in business development and marketing.
Sarah McIlroy, Founder & CEO, Fashion Playtes, an experienced, innovative marketing executive with 15 years experience in product management and the interactive world of gaming.
Brent Larlee, Managing Director, WaiHaka Strategies, moderated the session.
They each offered some guidelines about the way they think teams should be built to get funding:
Omar Amirana: The team is all that really matters. VC’s invest in People. Companies are People. People produce Innovation. People (and cash) fuel economies.
People have to be honest, trustworthy and rational. They have to be motivated and hungry for the opportunity. VC’s look for teams that are smart and knowledgeable with deep domain experience. This is particularly important in health care.
VC’s also look for teams that are strong but not bullying, and that have healthy checks and balances. They need to be results-oriented and responsive.
Sarah McIlroy: It’s true that a broad based skill set is a necessary component because needs change as a company grows. I truly believe the key for any early stage team member is an entrepreneurial spirit and a can-do attitude. There are lots of obstacles and it’s critical that you have a strong team ready to stand by you to build the business. It usually takes longer than we expect.
Glenn Champagne: An ideal fundable team is three to five CxOs on their 3rd startup together after two very successful M&A/IPOs, leveraging their experience, market and product knowledge. This team, primarily the CEO, will set the corporate culture.
We look for a CEO who is a proven leader and a visionary, someone capable of selling to customers, investors, media who is in charge and a CTO who is capable of managing development as company grows. Sales and Marketing can be added later, but these functions will identify the customer, and determine the price point, then sell the product. We only look for a CFO if the company is financially complex.
We expect everyone to wear a lot of hats in the early stage, and that there will be an environment of openness to foster innovation and solve real business problems.
The key characteristics we look for in our teams are:
•Honesty
•Leadership
•Vision
•Coachable
•Accessible
•Intelligence
•Driven
•Good communication skills
To learn more, please view Glenn Champagne’s presentations here and Dr. Omar Amirana’s presentation here.
What do you think it takes to build a fundable team? Post your thoughts here.
