Co-founders, Stop Pitching Together!
In March 2016, we tried to raise our first seed investment. As in most startups, three co-founders and I went to pitch together in front of investors. That was a huge mistake — one that, unfortunately, most new startup co-founders make.
The only person that should run the fundraising process and pitch to investors is the CEO. That reflects their core responsibility, ensuring the company has the resources to execute. When co-founders pitch together, it’s usually a symptom of a bigger problem, like lack of trust or unclear division of roles and responsibilities.
Allow me to explain.
Why founders should not pitch together
This scenario probably sounds familiar because it’s pretty common. Two or three co-founders decide to pitch together. They plan to present different parts of a deck, killing flow, momentum, and energy in the room. Then investors ask a question, and they’re not sure who will take it. One person answers, and others jump in with “just to add to that,” then say the wrong thing and break the story they’re trying to tell. Then they start disagreeing in front of the investors, who see all the tension between the co-founders.
The scenario highlights drawbacks to co-founders pitching together. As I see it, there are three main issues:
- It negatively affects storytelling. If you want to raise money, tell a fantastic story. It’s that simple. And to tell a great story, one person needs to control it and respond to cues from the audience (in this case, investors) to improve it continuously. It’s an iterative process, and it’s not something you can or should do together. One person, the CEO, should immerse themselves in the process to connect all the dots and have all the information.
- It adds more variables to the equation. When you pitch, investors scrutinize you, and every word matters. You have to ensure there are no holes in your story, and that’s hard enough to do by yourself. Now imagine you need to coordinate and control a constantly evolving narrative between several people — often in real-time, in response to something new you learn about or hear from your audience. It’s already a complex process. So the fewer variables, the better.
- It communicates that you have a dysfunctional team. Some will disagree with me about this, but my experience leads me to believe it. I don’t think there’s a reason for anyone but the CEO to pitch. If others want to be there, it’s usually for selfish reasons like “I’m a co-founder of this company” or “I want to learn how to raise money.” Sometimes it’s the worst reason of all: “I don’t trust my CEO to do it.”
All co-founders should still be involved
Now, I’m not saying that all co-founders shouldn’t be involved in fundraising. On the contrary, I think it’s essential. I couldn’t have raised without my co-founders’ help, and no investors would have invested without meeting them.
But co-founders’ involvement must be at the right stage and in the right way. For example, if you have a CTO, investors will want to do a technical deep dive with them, which is 100% appropriate. Investors will probably also want to chat with all the co-founders together and even grab dinner.
At this point, it’s critical to prepare your co-founders, sharing everything you told inventors and the narrative you’re trying to convey. That’s key. Misalignment can kill a fundraising process or lead to companies parting ways with a co-founder.
But staying aligned during a casual, low-stress dinner is more manageable than during a presentation to win investors’ hearts and minds. So when it’s time to pitch, let the CEO fly solo. In my experience, the increased power and clarity of the story will make you grateful you did.