🧠 You are a founder thinking about taking investment? – Then you should read this to the end
Below is feedback received for a concrete project – from the perspective of an early investor.
It’s direct, unpolished, and works very well as a reality check.
👉 Take it as a set of honest observations, not a final verdict. (it is subjective)
This kind of feedback helps founders see the world through an investor’s eyes: it’s not about a “nice business,” it’s about scale, exits and asymmetric upside. That perspective alone can save a lot of wasted time and misaligned fundraising.
For a less seasoned investor, it’s a reality check that investing doesn’t automatically mean returns. Most bets fail, percentages don’t justify early risk and without real upside or defensibility, money is often lost. Seeing both sides clearly leads to better decisions – and fewer bad bets.
1. Project profile vs. investments
This type of project is hard to scale and hard to exit.
It requires a lot of capital relative to its real return potential.
It’s not a high-growth bet, so you can’t make multiples (X-returns), only percentages — which don’t justify the risk.
2. The product (the major problem)
The product is not technically distinctive.
That makes it easy to replace:
- by someone with a better network
- or with a cheaper product
In this product category, it’s a zero-sum game for everyone because competition is on price when products are similar — everyone fights and ends up taking a small slice.
3. Value capture mechanism
There is no:
- breakthrough tech
- hard-to-access market
- possibility of patenting
Result: a weak and fragile value capture mechanism.
This translates directly into maximum risk for invested capital.
4. Early investor perspective
Early investors are looking for X-returns, not percentages.
To get X-returns:
- the company must grow aggressively
- there must be an exit or an IPO
With Romania as the target market:
- an IPO is irrelevant
- only acquisition remains
As a minority investor in a Romanian SRL:
- you may never see dividends
- the structure does not protect you
Conclusion: 99% chance the investor’s money is lost.
5. Impact of investments on the founder
Inevitable divergence of interests.
A lot of unnecessary stress on the entrepreneur.
Time wasted on:
- paperwork and anti-investing legislation
- pitching to people who don’t give constructive feedback
- managing investor relationships
Many investors believe:
- if they give money → they can have ideas (false)
6. Maturity, time, and opportunity cost
Time to maturity: 4–5 years (sometimes more).
If you factor in:
- inflation
- opportunity cost
→ you can end up negative even if the company grows.
7. The reality of investing
Real investing = small bets on very big ideas.
“All or nothing.”
99% fail, 1% breaks the rules (e.g. Revolut — 9 years to maturity).
8. The major mistake identified
Taking investment now is a mistake.
The project does not need investors.
It needs:
- sales
Customers are the real investors.
9. When investments actually make sense
Only for products with:
- clear high-growth potential
- rapid hiring (tens/hundreds of people)
- an attack on dominant market positions
Otherwise, investments do more harm than good.
10. The truth about VCs
The game is rigged.
Big money comes through:
- very warm intros
- personal relationships (cousins, former colleagues, etc.)
When you become:
- highly profitable
- with accelerated growth
→ then VCs show up “begging” to take equity.
