What Investors Often Overlook: The Other Side of the Founder Journey

Much of the conversation around startup challenges post-fundraising rightly focuses on founders’ leadership, scaling, and capital deployment struggles. But the role investors play in shaping those outcomes deserves equal scrutiny, particularly in the UK, where investor backgrounds often diverge sharply from startup realities.

Research shows that fewer than 8% of UK venture capitalists have ever started or worked in a startup themselves (Sifted, 2019). Unlike their US counterparts, many come from consulting, banking, or finance — backgrounds that don’t always equip them for the chaos, complexity, and leadership demands faced at the coalface of early-stage growth. The result is a frequent disconnect that can quietly undermine founder success.

From conversations with founders and market research, three recurring patterns stand out:

1. Misaligned Expectations and Short-Termism
Investor pressure to deliver short-term metrics can distract founders from building long-term value. This misalignment breeds risky decisions and an over-focus on vanity KPIs instead of sustainable traction or product-market fit. As GoingVC’s research on investor-founder harmony notes, these gaps erode trust and strategic clarity.

2. Under-Engagement — or the Wrong Kind of Help
After the cheque clears, many investors withdraw or offer guidance disconnected from operational reality. TechCrunch’s 2023 report found that founders frequently feel unsupported in critical areas like hiring and scaling, while micro-management from non-expert board members only adds friction and delay.

3. Poor Communication and Lack of Transparency
Founders often cite opaque investor decision-making, especially around follow-on funding and portfolio priorities. Sifted’s 2024 founder survey found that this lack of clarity and candour fuels emotional strain and uncertainty — an under-recognised source of burnout and mistrust.

The Ripple Effect: Founder Friction
These pressures ripple inward. Misaligned investors and uneven capital dynamics can fracture founding teams just when alignment and stability are most vital.

For the UK ecosystem to mature, investors must evolve from capital allocators into active, aligned partners who understand the operational and emotional realities of startup life. Founders, for their part, must continue strengthening governance, communication, and leadership to manage that complexity.

Realistically, until both sides grow together, the post-raise chaos and friction will persist.