VC Jenny Fielding sparked debate by questioning pre-seed founders' use of executive assistants (EAs). Her concern stems from observing founders' cash management practices, especially during early stages when revenue is limited.
Fielding emphasizes the importance of prioritizing product development and customer acquisition over operational overhead. She advises founders to focus on building a strong foundation before expanding the team.
While seed investors generally support founders' spending choices, they also assess cash management. This evaluation becomes crucial during subsequent funding rounds, as VCs provide introductions and recommendations to new investors. Learn more about startup funding.
Red Flags for VCs
- Early-stage EAs, COOs, and CFOs: These roles are often seen as unnecessary overhead at the pre-seed stage. Founders should focus on product development and customer acquisition.
- Excessive founder salaries: Fielding suggests a reasonable pre-seed salary range of $85,000 to $125,000. High salaries can quickly deplete limited funding. See how Y Combinator approaches early-stage funding.
Fielding's advice reflects the current funding environment, where efficient cash management is crucial for early-stage startups. Founders should prioritize essential expenses and demonstrate responsible financial practices to attract investors. For more on tech policy and investment, see Key EU Commissioners to Watch on Tech Policy.