Don't Please Investors

There's a dangerous point in fundraising when you stop explaining the company you're building and start changing it to match what investors want to hear.

I understand the temptation. They have the money you may so desperately need. They've seen hundreds of startups. They speak with authority, and their opinions can sound like wisdom handed down from Mount Sinai.

But here's the problem. They don't necessarily know better than you.

You may have spent years understanding a problem they've spent 30 minutes discussing. You know your customers, your technology, your team, and what you're capable of building. You have a vision of where your company could go that might not fit neatly into their mental models.

And those mental models can be spectacularly wrong.

A few reminders from startup history:

• IBM: Wall Street wanted IBM broken into pieces in 1993. IBM's new CEO, Lou Gerstner, refused, and led one of corporate America's most famous turnarounds.
• Facebook: Bessemer's Jeremy Levine dismissed investing in Facebook a few months after it was founded, because Friendster already existed. His advice? "Move on. It's over!"
• Also, Facebook: Peter Thiel and Jim Breyer initially favored accepting Yahoo's $1 billion acquisition offer. Zuckerberg refused, believing Facebook could become something much bigger.
• Airbnb: Fred Wilson passed on investing while they were in YC, before its $600K seed round. He later admitted he'd underestimated what the founders could build.

I've experseen first-hand how dramatically investor convictions can change.

For years, SoftBank had championed ambitious, long-term growth. Then WeWork collapsed. Suddenly, WeWork collapsed, and they started preaching cash flow and financial discipline. SoftBank even illustrated its earnings presentation with a stormy ocean. I experienced those waves from inside a startup.

Having a shit ton of money, whether earned or entrusted to you, doesn't automatically confer wisdom. Business decisions aren't just exercises in financial modeling. The most consequential ones often require intuition and taking risks that won't look rational until years later. Many investors are also following the same playbooks and pattern-matching the same problems. Experience is valuable, but it can also create spectacular blind spots.

On the opposite end, in my first startup, someone I deeply respected, with more distance, saw something I couldn't. I was too attached to what we'd built and too focused on the present to see far enough ahead. They challenged my thinking but never tried to impose their opinions. Looking back, I wish I'd listened more carefully.

That's the uncomfortable possibility. You night be an absolute visionary, or you might be an egotistical maniac and completely deluding yourself.

Sometimes the investor is right. Sometimes their distance from your business allows them to see what you're too emotionally invested to recognize.

The challenge is knowing the difference between conviction and denial. So listen. Challenge your assumptions. Actively look for evidence that you're wrong. Be willing to change your mind. But don't confuse listening with obeying, or investor approval with good judgment.

The best way to please your investors is to make them a shit ton of money.