A venture capitalist says one of the biggest reasons startups fail hinges on the relationship between co-founders.
Reece Chowdhry, founding partner of Concept Ventures, said early teams often split within two years because their co-founders clash or lack a shared vision. His venture capital firm, founded in 2018, says it is Europe’s largest pre-seed fund, which focuses on startups at the ideation stage. It recently announced it had raised $88 million for its newest fund.
Chowdhry told CNBC Make It that he invests based on founders’ personalities and traits before they even have a product. There are four to five key traits he looks for in a startup before going all-in, Chowdhry explained.
“I think 80% of our decision is on founders and we are typically the first investor in every company we invest in,” Chowdhry said in the interview.
“The number one reason companies typically fail in the first 18 to 24 months is that founders fall out with each other or don’t get along, don’t have the same vision alignment, purpose, and so that is something that we think is really important,” he said.
