Common Mistakes in Investing in Startups

Charles Hudson shares the common mistakes he’s seen after investing in 500+ startups. As the founder and managing partner at Precursor Ventures, he’s invested in hundreds of companies and has seen massive shifts in the markets that require founders to get creative and do away with the old fundraising playbooks.

■A high valuation doesn’t make sense for every company.

■The real risk with these big rounds is you end up being a prisoner of your own company.

■Talk to portfolio founders to see the kind of value-add the investor can offer.

■Great businesses aren’t always venture-scale businesses.

The markets are indicating that startups need to be flexible and creative. Choosing the right investors and having realistic valuations are crucial for a successful startup.