It’s hard to say no to a six figure check but sometimes your best option is to reject it. In this episode we explore three commons reasons for walking away from an investor that’s ready to put money into your startup. Here are some red flags to watch out for:
- An early stage investor that wants too much operational involvement
- An investor that gives you an exploding offer
- A wealthy individual that is making their first and only angel investment
For each scenario we point to stories from real founders that we’ve worked with and why their decision to walk away ultimately helped save their respective companies. While there are always exceptions to the rule we bring up these cautionary tails to help first time fundraisers make the best possible decision for their company. The allure of money can be deceiving and as with any contractual obligation the decision to accept money in exchange for equity should be considered carefully.