What do Investors Look for in a Successful Startup?

Article by Mark Peter Davis

SeedInvest, a New York-based equity crowdfunding platform,�sat down with Mark Peter Davis, Managing Partner at�Interplay Ventures,�to discuss investing best practices, recommended startup due diligence, and common startup investing nuances.

Here are the key takeaways from the discussion:

Should you invest in a startup with a�huge market, an�incredible team, or�phenomenal technology?

• The key is to invest in a company that has some degree of each
• �We�re trying to check all of the boxes at the sufficient level�
• You should never sacrifice two of the three for just one strong area

What do investors look for when searching for successful startups?

• Pinpoint the company�s core function
• Analyze whether or not the core team/CEO can efficiently execute that core function
• Organized and emotionally intelligent entrepreneurs

�Wait for the one where you can�t believe you�re going to get in�that�s when you should invest�

Do you have any startup investing advice?

• Don�t be too quick to rush into a deal
• Don�t be afraid to pass on a company that isn�t fully there
• There are always similar companies to examine

Are there any nuances to startup investing?

• If a company is targeting a narrow customer base, things can go wrong quickly
• Always look for momentum in product development and �be able to see milestones of progress made over time�
• Look out for possible friction between startup founders
• While there are some common nuances, there are just as many unique ones