Dear SaaStr: What Was The Best Advice You Ever Got From an Angel Investor

Dear SaaStr: What Was The Best Advice You Ever Got From an Angel Investor

In the world of start-ups, advice from angel investors can be invaluable. They bring not only capital but also years of experience and a wealth of knowledge that can guide founders through the challenges of building a successful business. One such piece of advice, shared by a founder who wishes to remain anonymous, has had a profound impact on their journey.

The story begins during a particularly difficult period at the founder's last start-up. Their co-founder had left the company, leaving them with just four months of remaining cash and a dwindling customer base. The situation was dire, and the founder was feeling overwhelmed and out of ideas. They decided to seek guidance from one of their angel investors and mentors, hoping for some clarity or direction.

Upon meeting with the investor, the founder shared their frustrations and the bleak outlook for the company. The investor listened patiently before cutting them off. "Enough," he said. "I’ve heard enough. This isn’t working, at least as you see it right now."

The investor then offered a surprising solution: "Go get on some jets. Go meet more customers and close bigger deals." At first, the founder resisted the idea, but they eventually decided to follow the advice. This decision proved to be a turning point. By focusing on expanding their customer base and securing larger deals, the founder was able to close significant partnerships with companies like GE, Dell, and Comcast.

The investor's next piece of advice was equally impactful. "Go hire some better people," he urged. "Just find a way." The founder took this to heart and began the process of recruiting top talent. This decision led to the hiring of a highly capable VP of Marketing, who played a crucial role in driving the company's growth.

Finally, the investor emphasized the need to extend the company's runway. "No excuses," he warned. "Find a way to increase your runway." The founder responded by taking drastic measures, including forgoing their own salary and raising an additional $500,000 at the last round price. These actions, combined with other strategic tweaks, provided the company with an extra year of runway.

Looking back, the investor's advice was spot-on. The founder realized that dwelling on their current situation and feeling sorry for themselves was only hindering progress. Instead, they learned to embrace the challenge and find ways to do more, even when it seemed impossible. The investor's words served as a powerful reminder that growth often requires taking risks, pushing boundaries, and refusing to give up.

This experience taught the founder a valuable lesson about perseverance and the importance of seeking out constructive advice from seasoned mentors. By acting on the investor's guidance, they were able to transform a struggling start-up into a thriving business. The investor's advice remains a guiding principle for the founder, reminding them that even in the darkest of times, there is always a way to move forward.

In the end, the investor's words encapsulated a simple yet powerful truth: when faced with adversity, it's crucial to stop feeling sorry for oneself and start finding solutions. By doing more, founders can accelerate their progress and overcome seemingly insurmountable obstacles. This lesson is one that resonates with entrepreneurs across industries, emphasizing the importance of resilience and proactive problem-solving in the face of challenge.