A lot of work goes into finding the right investors for your startup. But for a few of Portland’s most successful founders that have raised a combined $90 million, it boils down to one thing: The people.
Speaking at an event Friday morning put on by the Technology Association of Oregon, Puppet Labs CEO Luke Kanies, Urban Airship CEO Scott Kveton and True Ventures’ Puneet Agarwal — whose firm invested in Series A rounds for both companies — discussed advice for raising money and choosing the right venture capitalists.
For Kanies, who took his first $2 million investment four years after he founded Puppet Labs in 2005, the focus has always been on making sure investors are people he’d like to work with.
“The theory is that it’s easier to get divorced than it is to get an investor out of your business,” said Kanies, who closed a $30 million Series D round this past January.
Kanies said that while most people think only about the money, it’s not just about the ability to write a check.
“The reality is, you don’t want someone in your board meetings who is in a position to block your decisions if they don’t trust you and if they’re not in it for you and your team,” he said. “You need to why they’re in it. Spend time with them. You need to know that, at the very least, they will do no harm to you and your plans, and preferably provide some sort of positive benefit beyond just a check.”
Kveton, who actually met Agarwal through Kanies, agreed. He said that after going through four investment rounds, Urban Airship has developed some sort of a strategy for how they find the right firms and investors. But it all comes back to the people.
“It’s more about how we jive with the people we sit across the table from,” Kveton said. “Everybody has checked cashes — it’s what’s happened after that that is the most interesting stuff.”
From the investor’s view, Agarwal actually had the same thoughts in terms of what he looks for in entrepreneurs. For True Ventures, an early stage firm investing in the $250,000-to-$2 million range, “people is everything.” Agarwal said both Kaines and Kveton exhibited “visionary” qualities and were building something much bigger than a product.
“We find not just founders, but founders of movements,” he said. “We’re looking for people who have a vision and who have that passion. You can just tell, even in the initial conversations, the level of passion someone has for an idea. You can feel it inside their offices and the flow they have with co-founders. We saw it right when we met [Kveton and Kaines].”
We’ll have more from today’s panel on GeekWire, so check back later for that.