Gouw and Stanford University finance professor Strebulaev talk about angel and venture capital funding at Silicon Valley Open Doors event in Mountain View. Gouw tells entrepreneurs to think of the term sheet as a prenuptial agreement where the relationship between the entrepreneur and VC is like a marriage that will last about eight to 10 years. To make it work, Gouw points out five strategies:
1: Focus on doing a set number of things right
2: Know the value of the venture capitalist – VCs can help the entrepreneur with follow-on rounds of funding and finding the right talent.
3: Strong boards are critical – in the end the best boards vote unanimously
4: Vesting can be costly – find an equal vesting ground for everyone
5: Funding goals – make sure they match your personal goals