Question

9. a) You are an angel investor and you invested in a series of startups in the FinTech space. Two of your portfolio companies appear to have exactly the same target market. What would you advise?

b) One of your portfolio startups is not meeting its growth targets and is falling behind the expected month-on-month customer growth rate. Your investment is conditional on meeting growth targets and the quarterly tranches tied to these targets. The startup is also facing cash flow issues. What do you do?

Answer 1

9. a) You are an angel investor and you invested in a series of startups in the FinTech space. Two of your portfolio companies appear to have exactly the same target market. What would you advise? (8 marks)

b) One of your portfolio startups is not meeting its growth targets and is falling behind the expected month-on-month customer growth rate. Your investment is conditional on meeting growth targets and the quarterly tranches tied to these targets. The startup is also facing cash flow issues. What do you do? (7 marks)

A) As per my ideology, the following are the points:

• I will advise both with respect to these fintech organizations to rethink their plans of action (target market) in the event that they need me to put resources into their new businesses. Since putting resources into two commonly serious new companies will just carry mayhem and disarray to me.
• As an Angel Investor, my essential concern is to gain income/benefit which is exclusively reliant on the achievement of the startup in which I have made my venture. So If I put resources into two new businesses that attempt to serve a similar market fragment then it will surely cause both of these new companies to become contenders and will attempt to hamper the development/achievement of another startup. Since I have put my cash in the two, a definitive failure will be nobody however me. So I will request that they return to their strategy and additionally focused on the market.
• What's more, on the off chance that they would prefer not to change their objective market, at that point I will put my cash in just that startup which at first sight appears to become effective as a result of its field-tested strategy, HR, and specialized abilities.

B) The following are the points how I do :

• If the startup wherein I have contributed doesn't perform well then I will request that its administration give a legitimate clarification for the disappointment of the startup and for what reason would they say they are not ready to meet development targets? What are the components/obstacles which are causing this issue? What's more, the most significant inquiry what actions are they taking to handle these issues?
• Furthermore, in what timespan they will have the option to sift through the current issue? I will solicit the administration from the startup to give an agreeable answer to these inquiries. In the event that I got persuaded from their clarification, at that point I will give a timespan to substantiate themselves and in the event that I don't get persuaded, at that point I will leave the startup by offering my portions of the startup to spare my venture.
• Since as a heavenly attendant financial specialist at most I can give them a timeframe to handle the issue and become a benefit making organization else I will leave the organization as I am in the market to acquire cash and I will put my cash in some other great performing startup.