Sua Cho, principal at Underscore, says the team slide matters most in early-stage pitches. Show why you're uniquely motivated to solve this problem now, what superpowers your team has, and where you're weak. Credentials alone don't work without customer understanding and real passion.
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Hi, I'm Sua Cho. I'm a principal on the Underscore investment team focusing on health, tech and fintech. Today I want to share a little bit more about what we're looking for in founders and their teams. Team is everything. And when I say everything, literally, it is the most important criteria in our diligence process. In real estate, you might hear phrases like, the one thing that matters is location, location, location. In venture capital, the equivalent is people, people, people. Oftentimes, founders can think that it's not important to cover and go straight to the market, opportunity and product, but you really have to spend time articulating why your team is uniquely qualified and why you and your team are going to go crush this opportunity. So in a conversation with founders, there are probably three biggest things that I'm constantly thinking about and assessing. And to be honest, the number one thing is why. Why are you and your team uniquely qualified to solve this particular problem and pursue this market opportunity now? So your own personal reasons and motivations for building this particular business is actually one of the most important things that I really like to understand at a personal level. And that's why I like to spend time with founders, get to know them. Why are you building this? What does success mean for you? And some of those maybe more qualitative aspects are actually very important. So that's number one. The second thing that I always look for is actually superpowers. So whether it's a functional expertise that you have that you're bringing on the operating side, or very specific industry background, have you lived this problem? Do you have a network of customers that you can engage as you start to build the product and go out and build this company? And then the last one is actually on the weaknesses. At any seed stage company, if you look at the team, there are usually some gaps on the team. Are you self? Aware? Do you understand what gaps you have on the team? Are you aware of what your own personal blind spots are? And do you have a plan for how you want to surround yourself with other people that can help you complement and address some of those blind spots? So as you're crafting your pitch narrative about your company, one thing I'd like you to remember is being totally authentic about how this connects with your past experience and where you want to go in life. I know a lot of repeat founders that vary their background and experience if they don't feel like it was a true venture scale exit. But we actually appreciate the honesty and sharing. What have you learned from your past experiences? Even if it was a failed company, to be honest, and if you're a first time founder, why are you building this? What motivates you to do it? What have you learned about the opportunity? How did you learn about the opportunity? I think a common misconception that a lot of founders have, and unfortunately for good reason, can be that credentials matter the most. While credentials can be an important consideration, that's not the only thing that we like to think about or look for. Oftentimes people think, oh, just because I went to this brand named school or I come from this big tech company and I'll throw on all those logos and investors will think there's your stamp of approval. It's actually not true. It's not always true that people who come from big tech companies can navigate the super early ground zero to one kind of startup process at the earliest stage. In the end, what it comes down to is somebody who deeply understands their end customers that they're gonna serve, what problems they're facing, and how you're gonna solve their problems for them. And that doesn't have to come from decades of experience in the industry per se, although that's always helpful. Passion is a very important ingredient for founders to not just build the product and bring it to market, since that's not an easy thing to do, but it's actually what also attracts investors and even talent to join your team. I have a specific example of a founder who, honestly, we've Already more than 10x our returns on the investment opportunity. And I'm not surprised that that happened, partially because I knew from the very beginning that this guy was going to be successful no matter what he does. You could just tell this is not just a job to this guy, this is not just a company that he's building. But he was so passionate about what he was doing that it almost feels like play. And that kind of passion you can feel in a conversation very powerfully. And I do think it's what makes people successful.
