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Reasons why Startups should invest in Strong Management

purity muriuki




Startups should invest in leadership to attract angel investors. The management, on the other hand, should unleash its potential to assure the investors that they are placing their investment in capable hands.

Therefore, no matter how ambitious the founders’ vision is, they can’t achieve it without talented leadership. Without this, the founders will struggle to get the startup off the ground for the management team influences the company’s performance, thus growing investors’ wealth.

The business should ensure it has a team with what it takes individually and collectively to grow the investors’ funds. The agile investors are not looking for a fully stocked corporate boardroom, but there are specific traits that they are concerned with. The following are vital traits investors want to see in your startup.

A Cohesive Team

There are two types of investors; active startups investors who play a crucial role in driving the business forward. These investors meet the management team regularly. The second category is the hands-off investors that work in the shadow, but they interact with the team from time to time.

Therefore, investors should create rapport with the management team since personality clashes are not conducive to business. Further, these differences can shorten the exit; thus, it’s crucial to work as a team.

The relationship between the management team should be healthy, as well. However, this doesn’t mean that the team should agree on everything. There is a need for managers to question the strategy and decision as they strive to capture their market share and win customers. On the other hand, although each member of the team has a different perspective when handling a particular problem, consistently pulling away will strain the business, and it’s likely to veer off.

Establish a Business for the Right Reasons

Some founders start a company for the wrong reasons, such as to gain autonomy and freedom. However, they fail to realize that the buck stops with them always, and the business needs them every time, including Friday night or Sunday morning. This is particularly true when the business grows, the founders are answerable to customers, and investors as well as the entire workforce.

Another wrong idea is starting a business as an opportunity to get rich. Although this is an undeniable attraction and perfectly legitimate in the initial stages, lack of mission and a strong team will hinder the business from reaching an IPO, merger, or sale. The management should be innovative, create opportunities and jobs.

Relevant Experience

Founders of startups should have adequate experience in the same industry as the startup. A three years’ work experience is enough to launch a highly successful enterprise than those without any experience. Therefore, the founders and the managers should have experience in the relevant sector and business, which serves as a reassurance to potential investors that their funds are in safe hands. On the other hand, having relevant experience is merely a reassurance, but not a guarantee that the business will succeed. Additionally, a young team can capitalize on innovation, particularly when working in a stagnant industry.

Market Knowledge

Although some companies make mistakes and can get away with it after some years, most startups don’t have such luxury. Any failure to understand the market can cost the business a lot before it reaches the break-even point. 

Therefore, the management team has to analyze the market and understand how it’s likely to change or develop in the future.


Investors are concerned with two skill’s aspects. First is whether the management has the required skills to execute the business’s strategy or plan. Second is whether it’s aware of existing gaps and the plans it has to fill them now and in the future.

The business needs sales, leadership, technical skills, and every member of the management team should have these essential attributes. However, they can nurture the willingness to adapt, learn, or try new ideas.

On the other hand, most investors have valuable experience and expertise in business, which they are willing to share with the management to change what is not working.

Finding the Candidates for the Right Management Team

Startup founders don’t conduct business activities alone; they do so with other managers and employees. The following are the key points that they should consider when looking for the right management team candidates.

The specific skills and experience that the candidate has in relation to the position.

The candidate’s degree of passion for the business and the founder’s ideas.

The candidate’s references support and confirmation.

The person’s strength to perform the assigned role and support the business.

The type of resources the business is hiring; a fulltime candidate, or an interim one. 

Hiring a Great Team before Funding

A startup is required to have a strong team before accessing funding. The question is where the founders will get money to pay their management team before getting an investor.

To recruit a strong team, the business owners must rely on the passion of their business, the possibility of new opportunities, and personal networks. The co-founders have to obtain referrals from their network, business partners, mentors, and friends because they don’t have enough resources to sustain them.

The second option is to hire young, inexperienced resources with high energy levels, pure talent, and passionate about your business. Indeed recruiting well-known industry experts is an uphill task since the company is new, has no track record, and can’t meet their salary and benefits requirements.

Further, the experts are not the best fit for your company since they have experience working in big organizations, and the environment is different from a startup. These resources perform well in such an environment due to the support they receive from the organization of which you will not be able to offer. 

Employing The Right Management Tools 

Use advanced digital technology to your advantage. By using the right tools, managing sales and marketing is a lot easier with automation, analytics, and other advanced software programs. 

You can save your time in manual work and use it more productively in other things using the right tools. For instance, you can easily see and authenticate the sender of emails on behalf of your organization, and you identifying senders automatically using a comprehensive database. Hence, you can stop email impersonation, shadow email, and phishing attacks using a reliable software program, such as DMARC as a service.

Project management software can help startup businesses handle client tasks in an organized manner. For instance, if your business receives and manages projects regularly as a part of your core operations, using a project management software program allows you to add, monitor status, tag, and submit projects in one place.

Inventory management software is applicable for retail, manufacturing, warehousing, and other industries managing products. This tool is essential for stock, supply, or inventory monitoring for efficient storage or warehouse management.

Once your business employs more people, you would also need an employee management system to assign roles and monitor tardiness and absences more efficiently. It also pays off using an accounting management software for billing, invoicing, tax planning, and bookkeeping.


The team at the helm of the company is the one that steers the business to success. However, they must be the right people to do so. Your investors must be convinced that you have the right team, with skills, experience, and knowledge.

You can ask your network for referrals since you don’t have enough resources to both pay and support them. You can also hire young talent without experience and train until they achieve the qualification investors want.

I'm a passionate full-time blogger. I love writing about startups, how they can access key resources, avoid legal mistakes, respond to questions from angel investors as well as the reality check for startups. Continue reading my articles for more insight.

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