FOUNDER VS INVESTOR

Zalman and Neumann, a founder and an investor, respectively, jointly examine the fraught relationship between the two often combative roles in this business book.

According to the authors, the collaborative exchange between founders and investors, while so often central to Silicon Valley entrepreneurship, is fraught with tension. As they succinctly put it: “Founders and investors sometimes see the world differently.” Instead of producing a focused exploration of that fraught but commercially central partnership, the authors take turns furnishing their own individual perspectives in an exchange that itself often turns contentious, mirroring the nature of the relationship they deftly explicate. Together, they take the reader on a tour of the key elements of the founder-investor alliance, including trust, fundraising, contacts, navigating the board of directors, and the all-important issue of growth. Neumann defends the investor position and is generally more conciliatory—he believes the relationship is predicated upon a trust that is imperfectly secured by “norms” built into it. Neumann asserts that while investors are principally concerned with generating wealth, they are also motivated by the advancement of human progress. Zalman takes a less sanguine view, seeing the founder’s reliance upon venture-capitalist funding as, at best, a necessary evil, and only appropriate for the founder who prioritizes incredibly fast growth to dominate a market. Her mistrust of investors is unflinchingly presented: “Nothing matters more to them than their reputation, their returns, and not rocking the boat within their own industry with their peers. I come second to fear and money, no matter how good of a job I’m doing.” The edifying back-and-forth between the authors culminates in a dialogue in which their competing positions are lucidly clarified. This is an impressively candid work, and one of remarkable practical value to anyone who intends to be a founder or investor, or work with either.

The rarest of business books, one that provides genuinely actionable counsel delivered without empty cliches.