1. State your business. What is the problem your startup aims to solve? Why this problem?
“So, trucking is one of the largest unorganized segments in India. And every stakeholder who deals in this industry has a large number of pain points. And what we are doing is making things simple for people and making things efficient.” – Rajesh Yabaji, co-founder and CEO at BlackBuck, India’s largest trucking logistics company
Sustainability and nation-building are major considerations for some investors. Is your startup here to fix systemic gaps, like India’s largest digital health platform Pharmeasy, or an industry-wide issue like cross-border payments company Thunes? Make sure to identify the pain point your startup aims to focus on, and how your startup wants to solve this.
2. Where do you see your business in the next five years? What are your crisis plans?
“I think investors are looking to…[see] how do you handle a crisis like this, how do you deal with the challenges.” – Jixun Foo, Managing Partner, GGV Capital on how founders should handle crises.
This is a test of how forward-looking the management team is, their grasp of the current market, and their ability to anticipate roadblocks and plan for these. Your answer should cover market challenges, future key staff recruitment plans tas your startup grows, and some secondary scenarios that demonstrate your startup’s readiness to adapt. Strategies to tide over a major economic crisis like the recent Covid-19 pandemic can be a good case study.
Be upfront about any anticipated challenges and acknowledge the areas where your team may need help. Doing this shows an awareness of the gaps in your expertise and a willingness to ask for support when needed. Even Thunes’ CEO, Peter De Caluwe admitted freely, “I’m probably still a very traditional European person, and I don’t think big enough. I need to push myself every time very hard to think way bigger than what I’m thinking of.”
3. What domain expertise does your team have? Why did you come together to start the business?“It’s very difficult to find a team of four or five co-founders that can work efficiently well with each other. It is not easy at all.” – Hans Tung, Managing Partner, GGV Capital
If you are an early startup, investors want to know if there are qualified core members with complementary skill sets and a shared ideology.
For Pharmeasy, Siddharth commented on his three co-founders, “Each one of us picked up a part of the problem to solve and worked really hard at that. And that’s what’s allowed us to focus on growing ourselves. So, in some sense, you can say that we’re all generalists. But internally, each one of us has now actually become a specialist on a certain part of the business.”
Siddharth’s team included engineers and a trained medical doctor, who oversaw marketing and growth, technology, and operations while he played generalist and dispute arbitrator. Investors also want the assurance of seeing a team that is fully committed to the cause of the startup, and not just moonlighting – this shows that they too are invested in ensuring success.
4. Who are your competitors? What is the market share you aim to capture?“But I think as a CEO, it’s not just about understanding a technology, a product, and the team, it’s also very important to understand the customer.” – Jenny Lee, Managing Partner, GGV Capital
Having a solid grasp of your competitors is a good sign that you have done your research and are well aware of the industry standards you are up against. Even if your investors-to-be are sector experts, they want to hear from the horse’s mouth about the companies you are measuring yourself against.