Founder-investor vows

Mark Goldenson
2 min readMar 14, 2017

“The single biggest problem in communication is the illusion that it has taken place.”

-George Bernard Shaw

When founders and investors sign a term sheet, they are effectively signing a pre-nup agreement. They are defining who gets what and what happens when things go wrong.

This is necessary, but how many founders and investors explicitly define how to make their relationship go right?

I’ve raised venture capital for three startups and my experience is that this is rarely done. There may be informal conversations about board meetings, performance reviews, and target metrics, but I’ve never seen mutual commitments and expectations written down for clarity.

I think the startup ecosystem needs founder-investor wedding vows.

We are muddling through

If you are a founder, can you answer these questions about your investors?

  • What information do they want regularly outside of board meetings? How often and in what format?
  • What events — good and bad — do they want to be immediately notified of?
  • What is the minimum return they expect to consider their investment successful? When do they expect an exit?
  • How willing are they to lead or invest in the next round? What milestones do they want to see achieved to do so?
  • What do they think would be grounds for replacing you?

If you are an investor, can you answer these questions about your founders?

  • What value-add do they expect of you? Do they expect this from you constantly or only on request?
  • What outcomes, personally and professionally, would they consider successful?
  • What are their greatest strengths and weaknesses? Do they know and agree with your view?
  • How are you helping them improve on or mitigate their weaknesses?

These are not theoretical questions. They are practical ones that we answer through our actions. Failing to communicate the answers is likely hurting the founder-investor relationship and subsequently the company.

Drafting a template for vows

I’m now collecting feedback from founder and investor friends to create a template for startup vows. Each should be personalized but share enough in common that a template is possible.

I’m working through the right format. One example:

[Founder]: I will lead with the bad news, admit mistakes and unknowns, and share where I think both the company and I need to improve. The company will create an executive dashboard with performance metrics and targets that you can check at any time. Let me know if there are any metrics you want to add.

I ask that you keep this information confidential. During rough patches, I ask that you default to problem-solving instead of criticizing. I ask that you provide an annual performance review of me with honest, constructive feedback on my strengths and weaknesses.

All this may sound touchy-feely to some, and frankly, it is. But upfront honesty strengthens relationships and few relationships are more important for founders and investors than the one they share. It’s worth vowing to get right.

If you have suggestions for the template, feel free to leave a comment or note.



Mark Goldenson

Passionate about improving the world through science and technology. 3x founder, Group Product Manager at Google.