50 Questions Founders Should Ask Themselves About Investors

I have received investment in my business from top tier VCs and investors.

I have narrowly avoided taking investment from the wrong investors.

Now, I’m the CEO of a profitable and rapidly growing company.

I could not have achieved this if I didn’t pause and start to ask myself and potential investors better questions.

So if you’re thinking about taking investment from investors…

STOP!

Before you do, I implore you to think deeply and create a list of questions to think about. The questions that follow aren’t necessarily for you to ask your investors, they’re designed for you to think about, and to help guide you as you select what investors you want to work with.

That simple act can save you years or decades of confusion and pain.

And the right investors that you need… Those dream investors who can help you succeed…

They will thank you for asking better questions.

These questions have helped me slow down and think more clearly. It’s my hope that at least one of these questions will help spark an insight or realization that helps you find the perfect investor(s), avoid the wrong one(s), and achieve massive success in business and life.

Before we dive in, let me explain how we developed this list. The foundation of this article was developed from years of being and living amongst founders and investors in Silicon Valley.

As part of our research, we spent a week working with Founder Institute.

The Founder Institute helps tech entrepreneurs build a business and raise funding with the help of experienced startup mentors, advisors, and investors. They have chapters across 180+ cities and 6 continents. You can learn more about their pre-seed startup accelerator here.

During our time collaborating with their team, we had the opportunity to interview and chat with hundreds of successful founders, mentors, and investors. It is through these discussions, our own research, and years of personal experience that we compiled this list.

And now, 50 Questions Founders Should Ask Themselves About Investors.

1) Why are they doing VC instead of building another company? (Supposedly Jeff Bezos asked Marc Andreessen and Ben Horowitz this when they asked him to be an LP at Andreessen Horowitz)

2) When decisions or companies have they backed that are truly doing good in the world?

3) As F. Scott Fitzgerald says, “The test of a first-rate intelligence is the ability to hold two opposed ideas in mind at the same time and still retain the ability to function.” Can they do that?

4) The best founders and investors can be quirky, but also effective. Do the investors you want to work with embody this originality and quirkiness? And are they effective?

5) Why are you excited about working with these specific investors for the next 5–15 years?

6) Are you prepared to get to know who this investor is by having multiple conversations and hangouts with them? Are you excited when you get to hang out or spend time with them?

7) How will their expertise, knowledge, and connections specifically help you and the company?

8) What are their goals (business model) and how will your expertise, knowledge, and business specifically and strategically help them achieve their goals?

9) Could you take feedback from this person that is extremely honest, critical, and blunt (while still respecting them)?

10) Have they built and sold a company?

11) Was that company or outcome something you admire, and will the domain knowledge they gained in the process be complementary with what you’re trying to build?

12) What evidence is there that they are willing to bet on who you are (and are becoming) as a person? In other words, are they confident that no matter what happens with the business, you will be able to figure it out?

13) Are they fundamental or dogmatic in their thinking? Or can they, and do they, regularly change or adjust their beliefs?

14) What personal belief have they changed in the last year or so, and why?

15) What’s the most valuable thing they’ve learned in the last year?

16) The now classic, “what important truth do [they] believe that few people would agree with them on?”

17) Who are there mentors? Who do they learn from?

18) Have they had a job or time in their life where they were humbled? What evidence is there that they can check their ego, roll up their sleeves, and chop wood and carry water?

19) What type of questions do they ask you? Are they asking what your childhood was like (a first principles approach to discovering who you are), or are they only focused on the present and what you’re currently making?

20) What proof or evidence have they given that they thoughtfully read through your deck, or are listening to what you’re saying? Plenty of investors haven’t set up proper filters or systems and get mired in a deluge of inbound. Because of this, they have a tendency not to listen on the phone or read the decks or emails you send.

21) Do they take care of themselves physically and mentally?

22) What addictions do you suspect they have and do they have a substance abuse problem? (I’m serious here- plenty of investors have more than one skeleton in the closet, and even something small like a daily overdose of sugar or caffeine can signify they’ll never be able to lend cognitive capacities to you that aren’t befuddled by adrenaline or a sugar crash.)

23) Do they want to back founders like you? Sadly, there are still many investors who actively look for founders who are borderline psychopaths that will do anything to “win”. What type of founder do they back?

24) Have they had a successful long term romantic relationship in their life? This is one of the most undervalued tells to discover what people are really like, and how well they collaborate with others.

25) Do they respect you? Do you respect and want to learn from them?

26) What portfolio investments have they been the first or lead investor in? Do they have a track record that shows courage and conviction? Are they lemming-like? Do they spray and pray, or do they back the truck up when they have conviction?

27) Have they had an exit that was more than an aqui-hire?

28) What type of compensation structure is their firm rumored to follow? Are they choosing a lower salary in exchange for a larger upside or carry?

29) Who are their LPs, and are you excited about making these people or institutions more money? If you can’t find that information, do research, or ask them. Understand if they can’t disclose all of them, but you should at least be able to turn up a few. Do you want to work your butt off to generate returns for these LPs?

30) What are the economics of the potential investment they would be making in your company, and what result do you need to generate to make it a success? For example. If they’re investing out of a $1.3B fund, do you have a coherent answer for how the piece of your business that they would own will grow to be worth $5B+ within the timeline they need to return capital to LPs?

31) What is their response when you explain to them how you’ll reach your first hundred million or billion in revenue?

32) How well are their other investments in their current or previous fund performing? Are there past or present funds up by an incredible multiple (say, ~7.7x times) that’s better than industry averages? You should want to be on a winning team just as much as they do.

33) How much do they usually invest, and who else do you have to bring into the round to make it easy for them to say yes?

34) What percentage of the companies they back go on to raise subsequent funding rounds, exit, or IPO? Are they known for making (or being willing to make) extremely large follow on investments in their winners?

35) Do they have investments in portfolio companies that are working on big challenges (AI, human augmentation, preventing war, fighting cancer, education, space, hard science, etc…). Or do they have a lot of vanity investments in Series D rounds of popular unicorns?

36) Ask people they’ve worked with how this particular investor balances helping when needed and leaving the entrepreneur alone when it’s not.

37) What is the philosophy of their boss and the firm they work for? Do their philosophical beliefs and actions align with your own?

38) Do they ever express any of their personal philosophies publicly, especially if it’s different from that of their boss?

39) Reference Check: Connect with 3 founders of successful companies they’ve invested in, and get their take on the investor.

40) Reference Check: Connect with 3 founders of companies they’ve invested in that have failed, and get their take on the investor. Bonus points if you do a reference check on the individual founders who failed (it’s easy to blame your investors for what you failed to do).

41) Do their portfolio companies inspire and intimidate you (in a good way)? Are they important for humanity and society? Or, are most of their investments in things to just amuse humanity to death on the way to extinction?

42) Do they spot serious challenges, opportunities, and perspectives about your business that you haven’t thought about?

43) What are some of their daily habits and rituals?

44) Do they use buzzwords and phrases or substantive ones?

45) Wise men have said that “the world is made of language.” Several of the best investors in the world have started to hint that they are only looking for founders who speak indefinite future tense about what they will accomplish. What type of language does the investor you’re pursuing use? Do they make vague, indefinite comments? Or do they make definite, strong statements? Can they speak about your business indefinite future tense along with you?

46) Are they willing to trust or defer to your expertise or analysis of a market? Or, do they want a scientific study done by ‘experts’ about each observation, metric, theory, or insight you’ve discovered or generated? The devil’s advocate can be helpful if he wields logic and data, but if they can’t handle being proven wrong by you… you might want to run!

47) What type of people do they want to invest in and why?

48) What do they prioritize when investing: markets, tech, ideas, or people?

49) Are they willing to get to know you well enough to gain enough context to invest in you as a person, or make the necessary effort to do (smart) character and reference checks on you? If not, how can you ever develop a positive working relationship or friendship with them?

50) Who are the five people they seem to spend the most time with? They’re becoming like those they spend time with — just like you…


For a deep dive into these questions and more, listen to:

Mission Daily: Ep 208 — Questions to Ask Investors Pt.1


Thanks for reading! If you enjoyed this article, please share it with a founder who is thinking about taking on investors.

Becoming A Monopoly Of One With Skill Layering

“Nature loves courage. You make the commitment and nature will respond to that commitment by removing impossible obstacles. Dream the impossible dream and the world will not grind you under, it will lift you up. This is the trick. This is what all these teachers and philosophers who really counted, who really touched the alchemical gold, this is what they understood.” –Terence McKenna



We’re living in a time period where it’s never been easier to become a polymath. But in practicality, there are many cultural and social hurdles to this achievement. The idea of becoming an expert at many things seems daunting to many people, so they never begin. As time elapses, it’s easy to fall prey to many fallacies that prevent us from ever exploring our own ambitions. This is foolish because the earliest time we have to begin anything is in the present moment. Personally, I believe that there is always a hidden path waiting for us to begin, no matter what age or life circumstance we’re at. This hidden path always stands ready and waiting, and it’s our own failure of imagination that prevents us from starting on our own unique path of perfection.

So why is it so difficult to become a polymath or monopoly of one today? First, if we aren’t careful about our relationships and assert our intentions or large ambitions publicly, we’ll likely meet warnings to “slow down” or “just focus on one thing first.” This can sometimes be prudent advice. But oftentimes the people who voice their concerns about ambition have bought into the lie that we must dream small so we’re never disappointed. Those who wish to be mission-driven must never be afraid to keep dreaming big after every setback they face. In many cases, it’s actually better to ratchet up your ambitions after you survive a challenging ordeal, since now, you have more experience and information!

The secret that all polymaths know is that it becomes easier to learn when we increase our workload. When we have many things going at once, we can cycle through projects appropriately. In order to tap into the full power of our brains, it helps to have the right amount of projects (sometimes dozens) going at once. We can start slowly, but by moving in and out of overwhelm, we’ll be able to increase our mental capacities to handle it all.

There have never been more low-cost learning resources available to speed up our learning. Just consider the humble podcast, for instance. This is something many take for granted, yet the technology behind it is extraordinary. On any given day, online or directly on our phones, we can listen to the best teachers in the world from any given industry or field of study. This morning, I listened to an interview with a technology entrepreneur that I follow. She has created immense value in the world and radiates contentment and joy. I was able to pick up much of her wisdom and many of her insights at almost no cost. She wasn’t just answering questions; she was distilling wisdom that’s potentially life-changing if it’s applied. We might not be able to personally hire someone like that for coaching, but we can listen for next to nothing thanks to a podcast. Podcasts are an incredibly undervalued way to receive digital mentorship from the best in the world. For those who have the faith, willpower, and patience to teach themselves, the time to learn how to learn is now.

The standout men and women of history have all been self-taught, skill layering, life-long learners. Consider Leonardo DaVinci, Lucius Seneca, Ben Franklin, Mother Teresa, Elizabeth Holmes, and Elon Musk. Many of these people started far behind where we are in terms of resources, familial love, and technology that we now have access to.

Each of these monopolies of one suffered through adversities and were able to prosper without all the advantages we have in front of us today. They managed to become self-taught masters of many skills. No matter what circumstances we find ourselves in right now, others have triumphed over worse.

But how did these guys and gals do it? The simple answer, which we covered earlier and that most ignore (even after hundreds of years of it being repeated!), is that they learned how to learn through doing and taking massive action. They read, they wrote, they experimented, and they sought to be around others who were doing the same. They came up with ideas and then figured out how to begin pursuing them with the limited resources they (initially) possessed. They started small projects, they tinkered on and allowed their creativity to guide them from one project to the next. They didn’t look for their passions; they looked where it was easiest for them to invest huge amounts of effort and willpower.

To get started on this path, it can be helpful to begin rotating through many small projects in a strategic fashion. We can see for ourselves where we work the hardest and where we are the happiest. When it makes sense, we’ll know when to double down and go all in on a singular pursuit. Along the way, we shouldn’t judge ourselves for leaving projects unfinished. Learning to quit and leave some things undone is a healthy skill. We’re free to allow this learning and skill layering to ebb and flow based on our interests.

One of my favorite cartoon strips of all time is Calvin and Hobbes. The creator of the cartoon strip, Bill Watterson, rarely gave interviews. During one of those rare interviews, he was asked about creativity, productivity, and recharging. Watterson said,

“Shutting off the thought process is not rejuvenating; the mind is like a car battery — it recharges by running.”

This phrase can feel overwhelming until we stumble over the power of it for ourselves. When we find work or a pursuit that is making the world a better place, serving others, or spreading meaning… ten-hour days of work can feel short! Or, if we don’t have that luxury right now, we can explore recharging by coming home from our job and immediately switching over to a creative pursuit. The body and mind will revolt at first, but if we keep going, we’ll soon find a blissful, mission-driven state of rejuvenation.

One of the last hurdles to beginning to learn is that some people think we have to become world class at something before it gets interesting. They severely overestimate how long it takes to become skilled enough before new skills will provide us with meaning.

This hurdle is unfortunate because there are many things we can become “expert enough” at within only a few months. Expert enough means that we learn enough that we can begin to create valuable work that makes us feel mission-driven.

The process of skill acquisition on the road to mastery has been discussed extensively by several authors and researchers. These notable authors include Malcolm Gladwell, Timothy Ferriss, and Robert Greene.

Gladwell says it takes around 10 years to become world class. Greene takes a more strategic, Machiavellian-meets-Aristotelian view and says 10–20 years. But Ferriss comes in with the exciting reality that if we use the right stakes and incentives, we can become expert enough in a few months.

Mastery: top .01% of a field — takes 20 years

Budding Master: top 1% of a field — takes 10 years (outliers)

World Class: top 3% in a field — takes 5 years

Expert: top 5% in a field — takes 1–3 years

Expert Enough: top 10% in a field — takes 3 months to 1 year

More authors and researchers are beginning to emerge showcasing that “expert enough” can be accessible after only a few months of highly concentrated effort, stakes, and incentives. In his excellent book SmartCuts, author Shane Snow advocates studying the outliers or “fat tail” top performers in order to uncover the most sustainable paths that are both short and smart. Our culture has likely left us with warning alarms going off in our heads at encountering advice like this. Shortcuts? Taking the easy route? If our intentions are in the right place, and we’re seeking our mission, why wouldn’t we take every smart cut possible? From the Presidents of the United States, to CEOs of world-changing companies, it’s often the youngest and least experienced person that doesn’t know the “way things are done” who figures out the way things SHOULD be done, and then does them.

We’re also prone to underestimating the small victories that we’ll unlock along the way towards “expert enough.” Those small victories will compound. Compounding is, as Ben Franklin said, the eighth wonder of the world. Humans have a hard time imagining the sheer joy and meaning of their skills compounding, so they never begin.

At the expert enough level, there are plenty of ways for us to be compensated for our newfound skill or service. Also, consider how we can make the math part of the mastery equation work in our favor. To become the top .01% in a given field, it may take 20 years. But we can become the top .01% in a brand new field we create that combines several skills together. This is why becoming a monopoly of one doesn’t take nearly as long as traditional mastery in old, tired fields. Our mission lies in boldly exploring new combinations of skills for greater service.

Think about the person who chooses a few skills which are in high demand. They become expert enough at them, reap the rewards, and then repeat the process again and again. They might be one to three years into their learning, but they are not competing on the same playing field as the person who has focused on one thing, sunk in eight years of agonizing investment, and is wondering why he’s gone nowhere.

To become a monopoly of one and create a fulfilling and opportunity-packed life, we only need to concentrate on becoming expert enough at that first high-demand skill, break it down to a pursuit that only takes a few months, and then layer it with the next high-demand skill. This path makes the most sense logically and competition-wise. Why on earth would we want to spend 20 years devoted to becoming a master of a field overwhelmed with competition? It would be nearly impossible to become the leading computer scientist in the world without putting in at least 20 maniacally-focused years. But if we want to get started on becoming a world class polymath in technology, we could start learning the new iOS programming language, Swift. In only a few months, we’ll have a skill people will pay us for. Then, we could layer on the ability to port apps to Android, and we will be a hot commodity. Instantly, we unlock more options to work at more companies, freelance, or start a business of our own. Later on in our path, we can layer on JavaScript and other languages and competencies. In a short period of time, the person who does this will become a world class, full stack-developer. The person who takes the 20-year path to become an expert computer scientist will likely be eating ramen noodles as a teaching assistant while the person who layers her skills is busy reimagining a brighter future for us all.

The Premiere 21st Century Mindset, Goal, and Path

Some people hate the word “goal.” I agree that sometimes the definition can be murky. If we only focus and work towards one goal, we can find ourselves in a perpetual state of discontent. We tend to grow frustrated because we haven’t achieved it yet, then once we do, we become bewildered when the initial euphoria of victory passes. This is why a diversified set of goals, interests, and massive future projects are so important. With a basket of smaller goals, we can break each down until they are a series of little steps, with little victories, in order to consistently achieve the euphoria of “winning.” Once we begin spreading and breaking down our goals into manageable chunks, we can then pick out hyper-specific skills to begin learning. There are many small skills we can teach ourselves on the way to achieving broad and overarching goals. By starting with a massive goal, skill set, or pursuit, we can then get busy breaking it down into small, localized “goals” that we can begin learning. From there, we can learn the next skill, and then the next, until we gradually check off all the small goals necessary to achieve our big goals. On a path of learning like this, we’ll eventually find ourselves with an immensely valuable and unique set of skills. We’ll likely be at a place where competition is scarce. If we keep up the practice long enough, we’ll find ourselves as a monopoly of one.


“…Every business [or for our purposes, individual] is successful exactly to the extent that it does something others cannot. Monopoly is the condition of every successful business.” –Peter Thiel

“I’m not trying to find nobody else to beat.” –Drake

In this strategy and actions section, we’ll cover more examples of skill layering to become a monopoly of one.

If we want to become a world class designer, we might first practice sketching user experiences, learn Sketch and Photoshop, take on client work, and then build our own UX for our own apps. As we learn each skill and offer it to clients or the market, we’ll discover where the biggest margin lies: wherever there is an inefficiency in the market.

If we want to become a world class speaker, we could start offering gigs on Fiverr, Upwork, or ACX for voiceover work or narration. We could then find some speaking gigs by starting for free, and then begin to take free work with the condition that it’s recorded. After that, we can start charging a fee while sending out our recorded proof of work, or even take a sales job that forces us to speak articulately at length.

Examples of a Skill Layering Path in a High Demand Field

1. Learn the Apple iOS Swift programming language.

All we need to know about Swift is that its way easier to learn than its predecessor, Objective C — it’s a great time to get in! Apple will be the first trillion dollar company, so it might be a good idea to learn the languages they’re building.

Existing Swift developers have said the language is a huge simplification which creates an amazing entry point for anyone who wants to get started in the industry. If we learn Swift, we immediately have a skill people will offer us money for. At this point, we know we’re literally helping make the United States economy more efficient. We can even get started with a free book Apple has published detailing the Swift language. There are also online classes focused on Swift available via Thinkful and Udemy.

From this point, we could learn Sketch or Photoshop in order to do a little front-end work (if we are design inclined), or we could begin learning more about back-end work and APIs. This is just my non-technical explanation and brief skill layering overview, but you get the idea.

2. The next skills to layer onto the existing competency of Swift would be perfecting your app’s look and feel in the storyboard and becoming an auto layout guru.

3. From there, JavaScript can be extremely useful for learning the back-end of the apps we’re building.

4. Next, we can learn Amazon Web Services to become completely deadly and either start our own business or work to build apps for others. But at this point, there is a much better chance that we’ve received offers we can’t refuse and are being paid $150,000-$250,000 a year at a Silicon Valley technology company (and having breakfast, lunch, dinner and childcare paid for while we work).

5. Want to layer more skills? We can keep going and learn how to efficiently convert the iOS apps we build to Android via a tool like AppFolio. Now, we’ve moved even further toward creating a monopoly of ourselves.

6. From there, we go deeper into learning the existing skills we have. By this point, we’ll have found several niches with great margin and unique opportunity. Maybe we see an opportunity to layer on skills that involve learning sensors, HUDs, and wearable technology; the opportunities are endless.


The exercise below is to search for existing opportunities to start layering skills. Start below by writing down a skill people will pay for, then practice writing out skill layering progressions. How will we progress so that with each step, the air becomes more rarified, and we compete less and less?

We can even get technical and look up specific skills to estimate how many other people are proficient with them, and then study future projections and demand for them.

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Some additional questions we can ask ourselves when going through this exercise:

Is there a combination of skills we possess that no one else in the world has? Where have we already devoted 10,000 of our hours (intentionally or unintentionally)? Oftentimes, the answers we need about our own unique talents have been staring us in the face for years.

From this point, what brand new recipes of skill layering could we create?

If we’ve become proficient at teaching a specific type of class or skill, how can that directly translate into another sector? Is there a simple skill in this new sector that we could layer onto our existing training to reduce competition even more?

Now, let’s start looking extensively at places where we have an unfair advantage of practice. Maybe we are amazing parents, communicators, artisans, or great listeners. Or, maybe we have an analytical, left brain mind, with an obsessive attention to detail. Maybe we’ve worked and built things with our hands and are fascinated by building and machining.

Below, try the sample skill layering practice again by starting with where we already have invested time or have expertise. Feel free to continue to go through this practice. When our minds continually think in terms of finding less competition, our service to ourselves, those we love, and all of humanity continues to increase.

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