Founder who raised $1B tells VCs what investors really want to see
Puzzle founder and CEO Sasha Orloff shares in a new podcast episode what venture capital investors actually look for from startup founders during fundraising. He stresses the importance of understanding your company's financial reality before pitching investors.
In the latest episode of the podcast Build Mode, host Isabelle Johannessen speaks with Sasha Orloff, founder and CEO of Puzzle and an alum of the Startup Battlefield program. Companies Orloff has built have collectively raised more than $1 billion, giving him firsthand insight into what venture capital firms actually look for in startup founders.
Orloff explains that investors don't expect a startup to be perfect — they expect founders to have a clear grasp of their business's real financial situation. Messy data, misunderstood metrics, or delaying fundraising until cash is nearly gone can cost founders leverage, valuation, and even a term sheet that's already on the table.
A close call with a term sheet
In the episode, Orloff describes how he himself nearly lost a term sheet because his company's data room wasn't properly prepared. He also discusses how the level of investor diligence shifts as a startup matures, from pre-seed and seed rounds through Series A, B, and beyond.
The conversation also covers the importance of revenue growth and its quality, how runway is calculated, and how margins and sales efficiency factor into investor decisions. Orloff notes that being honest about what isn't working in a business can actually strengthen a founder's pitch rather than weaken it.
Orloff says his own frustrations with fundraising and financial management were ultimately what led him to build Puzzle. He also shares thoughts on how artificial intelligence could change the way startups handle accounting and track their financial health going forward.
