Startup life and death – the importance of finding the ‘right’ investors and mentors

When it comes to finding capital for a startup, there is such a thing as good and bad investors.

According to scientist turned entrepreneur turned venture capitalist Elaine Stead, the “right” investor brings much more than money to the table.

“The right investor brings with them some expertise, domain knowledge and guidance away from mistakes you wouldn’t otherwise have. Their expertise can stop you from short-circuiting your progress,” she says.

“They also bring networks and other means of accelerating your goals.

“Everything around those two core things is customisable.”

Conversely, the wrong investor can spell disaster.

“The impact of the wrong investor on a startup can be dramatic and sometimes fatal,” Elaine says.

“If you have shareholders and directors – and an investor can be both, and they often have significant influence on decisions made in the business – and you don’t have a meeting of the minds on expectations and goals for the business, you set yourself up for lots of friction and the inability to make decisions.

“It can be the undoing of an otherwise excellent company.”

Elaine says the right investor is aligned with the company’s founders and other shareholders and investors regarding the company’s goals and the journey ahead.

“A lot of investors say they understand startups can be volatile and that the journey to success is not a linear path, but when trouble hits, they don’t know how to deal with it,” she says.

“Having investors who understand the process you’re going through can save you. An investor base that understands failure is par for the course in the startup arena is very important.”

Over lunch on Tuesday, 13 September, Elaine will join a panel of experienced mentors and investors sharing their real experiences working with female founders at the next instalment in the Canberra Innovation Network’s Female Founders series.

Aside from the everyday challenges of entrepreneurship and starting a business, women-led businesses often also face difficulty when it comes to finding the right mentors and investors.

In “Female Founders: More Than Money – Investing in Women” the panel will share their journey of how they got started in mentoring and investing, what they look for in a good mentor-mentee relationship and how budding founders can begin to build these relationships.

“I’ve had so many mentors on my journey,” Elaine says.

“They’ve been critical not because they’ve been supportive but because they’ve pushed me to think of things differently.

“Others may need different things, that’s what I find makes for a fantastic mentor – someone who challenges you to think hard and do better.”

Joining Elaine on the panel will be PWC partner Rosanne Brand, a specialist in transformation program management and enterprise architecture (business architecture).

Passionate about lifting Australia’s digital infrastructure, Rosanne has helped some of the largest private and public sector organisations across Australia and the UK successfully reform and embrace digital service delivery.

Also on the panel will be Professor Tim Hirst, an entrepreneurial academic with wide-ranging experience establishing new venture-backed companies.

In addition to his current role in Gamma Vaccines, Tim is the GPN Vaccines Pty Ltd chairman and CEO, OzStar Therapeutics Pty Ltd chairman and Brain Changer Pty Ltd chairman.

Elaine says the panel will provide the opportunity to benefit from the “lived experiences” of people who have been where they are now.

“It’s important for founders to hear from others that their experiences are not isolated,” Elaine says.

“This founder journey is especially lonely; often people are doing it alone and responsible for all decisions. It’s easy to think you’re the only one who has grappled with something or feel like you’re not ‘killing it’ because you’re grappling.

“This is an opportunity to hear how others grappled, the strategies they employed to get through it and the networks available to tap into.”

Find out about more Female Founders events at https://cbrin.com.au/female-founders

Article written by Dione David for Riotact