Andy Walsh2x Exited Founder, Startup Strategist & Podcast Host

Rule One With Investor Cash: Don't Lose It

19 Sept 2026 · 1 min

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Andy Walsh says the first rule for founders with investor money is don't lose it. A $5 million fund dropping to $4.7 million means explaining a loss to your investors. Keep the principal intact.

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Priority number one, especially on the earlier stage, is preservation of principal. And what I mean by that is your investors invested, let's say, $5 million into you and they gave you that capital. Now don't go invest it in something where you're gonna lose it. Not actually lose it, but you don't ever wanna be in a situation where you have to go to your investor and say, oh, I actually just wanted maybe 50 more basis points on my cash, but the market took a hit and so now That $5 million is really only like $4.7 right now, but I think it might go— like, that's what we really want to avoid. And so that's number one.