295. You are your biggest investor - think like one

Your time, energy and capital are all scarce resources. Each has an opportunity cost.

And yet many founders make decisions about their ventures based on excitement rather than evidence — committing all three without ever asking the question a smart investor would ask first: is this actually worth it?

In this episode, Sophia Matveeva shares the investor framework she uses with her founder clients — one that reframes every build, hire, and fundraise decision as a capital allocation choice. 

You'll learn:

• Why you are the largest investor in your own venture — and what that means for how you make decisions
• The four questions every smart investor asks before committing capital, and how to apply them to your own idea
• How to speak to external investors with genuine conviction rather than desperation
• Why the founders who succeed aren't the most talented — they're the most rigorous

Whether you're sitting on an idea you're excited about or one you're quietly starting to question, this episode will change how you think.

Timestamps

• 00:00 - Introduction: You are your venture's biggest investor
• 02:36 - Typical fundraising journey and runway planning
• 04:43 - Four key questions for capital allocation
• 07:05 - Risk assessment: Business, emotional, and personal risks
• 09:17 - Approaching investors with conviction
• 11:36 - Action steps and closing

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Transcript

[00:00:00] Sophia Matveeva: You are the biggest investor in your venture, not your venture capitalist, not your angel, you. Too many founders are making investment decisions based on excitement rather than evidence. But not you, because you are going to listen to this episode.

[00:00:18] Hello and welcome to the Tech for Non-Techies podcast. I'm your host, Sophia Matveeva. If you're a non-technical founder building a tech product or adding AI to your business, you're in the right place. Each week, you'll get practical strategies, step-by-step playbooks and real-world case studies to help you launch and scale a tech business without learning to code. And this is not another startup show full of jargon, venture capital theater or tech-bro bravado.

[00:00:50] Here, we focus on building useful products that make money without hype and without code. I've written for the Harvard Business Review and lectured at Oxford, London Business School, and Chicago Booth. So you are in safe hands. I've also helped hundreds of founders both from concept to scalable product. And now it's your turn. So let's dive in.

[00:01:14] Hello, smart people. How are you today? Firstly, I want to thank listener DW31 on Spotify who left lovely comments for this show. Thank you very much. I loved hearing from you and I wish I knew your name so I could properly thank you on air. I do read all of your comments and reviews. So if you have been finding these episodes useful and you want to make my day, then please write a review on Apple or Spotify or leave a comment on YouTube because hearing from you really does make me feel all warm and fuzzy.

[00:01:48] And now I want to tell you about a conversation that I recently had with a founder client. He's setting up a new venture and he's getting one-on-one coaching from me as he begins his entrepreneurial journey. And we were discussing the startup capital that he would need to get his venture off the ground. So how should he think about it? How should he estimate what he needs to get started and so on. So I said, you need to approach this like you are an investor. So not like the founder, not like the creator, but like an outside person looking in and assessing the opportunity because let's think about what happens when you are fundraising.

[00:02:26] So when you're fundraising for a startup, you essentially you make a prediction. You say, I need X amount of money to get to Y milestone. And I predict that at that Y milestone, I will either have enough revenue to fund the company or I'll be able to raise more money at a higher valuation.

[00:02:36] Typical fundraising journey and runway planning

So for example, let's imagine that you have an idea for a tech venture, which I imagine many of you do because this is what we talk about. And let's imagine you've just gone through our Tech for Non-Technical Founders acceleration process. Now you have a test product. You know who your target customers are. You know what they're willing to pay. And you also now have a growth plan to acquire them. So you are now ready to hire professional developers and you are then going to invest in marketing. And you believe that once you have a live product and you have paying customers, then you'll be able to go to more investors and basically raise more money at a high valuation.

[00:03:24] And this is generally what people do. This is a pretty typical journey that I'm describing to you. And because you've learned about product development and growth hacking and you know realistically what needs to be done, you estimate that getting all of this done is going to take you 18 to 24 months. Again, that's kind of pretty average in terms of planning and startup life. And you've learned to budget for your tech team and you've learned to estimate marketing costs and we've taught you how to do that within our program. So basically with this for your specific product, you figured out that you need about $350,000.

[00:04:04] We have also taught you to add a contingency on top of what you think you need because you know, it always takes longer, it's always more expensive. So basically you decide that you need about half a million dollars and two years runway to invest in product and marketing. And then after that, you expect that you'll be able to raise more money. So this half a million is going to have to come from somewhere. So you might fund it yourself and many of our clients actually do that. So for example, if they already run a successful business and the tech product is just an extension of that work, or you might decide to fundraise from investors and many of our clients do that too.

[00:04:43] And the thing is, if you're funding it yourself, you might be a bit loosey goosey with your finances. And this is what I'm trying to stop here. Because when you're fundraising from investors, they are going to make you go through your investment thesis. And this is annoying and it's painful, but it is actually mostly a good thing. So I'm going to ask you to go through your investment thesis yourself, whether you're fundraising or not, because you are the biggest investor in your tech venture. Even if you fundraise, you are not going to sell more than half your company until you get close to IPO. And even then you are going to still be the single biggest shareholder. So you need to approach what you're putting into your idea, like an external investor would.

[00:05:32] And don't just think about this in terms of your money, but think about this in terms of all of your resources. And your resources aren't only money, right? It's also your time and your energy. So for example, you are now choosing to spend your attention and your time on listening to this show. Thank you very much. And I would also say to you that your time is much more precious than money because you can make more money. You can always get more of it. You cannot get more time. So this is why even if you're thinking, well, this is not relevant to me, you know, I'm taking some courses, I'm learning some stuff, I'm just listening to podcasts. That's your time. Are you using your time correctly? That's your most important resource.

[00:06:18] Four key questions for capital allocation

So here are four questions, four topics rather, that I want you to think about when you are thinking about how to allocate your capital and your time. So number one, how big is this opportunity? Essentially, is this opportunity big enough for me to pursue it?

[00:06:36] Number two, what is the opportunity cost? If I'm doing this, what am I giving up? What is the cost of giving that up? So for example, you might be leaving a very lucrative job with equity options. Okay. So you can actually evaluate that cost or maybe you're running a business and there's another investment in your business that you basically can't make. So you can build an app to scale your business and to reach more people. Just be honest about this. Yes, we can't have everything, but then if you're making these decisions consciously that, I'm going to invest in this tech venture. I'm not going to invest in, I don't know, hiring more sales reps. That's fine, but you need to evaluate this.

[00:07:05] Risk assessment

Number three, what are your biggest risks? And here be honest, because there are business risks and you know your venture, you know what you're doing much better than I do. The risks here aren't just business risks because they could also be kind of emotional and personal risks. For example, you could end up having a bust up with your co-founder if you have one. This actually happens all the time and it is often very legally and therefore financially painful. Or a serious risk that I often see with founders who've left very lucrative jobs is that basically you decide to go back into the corporate world when you notice that you can't take business class flights and you really want to go on that skiing holiday in France and you're not getting paid anymore. So these are real risks that actually make people give up on their venture. Think about them and what you're going to do to mitigate them and how real are these risks to you.

[00:08:04] And number four that I want you to think about. Think about what success looks like and not like, you know, crazy success, not magical thinking, but if everything works out, what would that look like? And this is really important because our brain naturally focuses on the risks. And if you're going to build your tech venture, you have to envision success and then you have to plot a plan to get there. This is something that some of the smartest venture capitalists do because it is very, very easy to take down a startup because it's so uncertain. There are so many things that might fail that actually the likelihood of it not working is high and also very obvious to see. So if you're going to be investing your resources in something, then you also need to really envision success because that's the only way you'll really be able to understand what the opportunity is.

[00:08:56] And by the way, these four topics, they're also a useful way to think about investments in your growth as an innovator and as an entrepreneur. So for example, you could invest in joining the Tech for Non-Technical Founders program, or you could not. We say that if you're going to build a tech venture, your cost of not joining us is $100,000 because you're going to make about $100,000 worth of avoidable mistakes if you try to do it all yourself without any guidance. But if you're not going to build a tech venture, then your cost of not joining us is going to be different. It might be smaller, I suspect it's going to be smaller. Maybe you never want to do anything entrepreneurial and you just want to learn about tech. Yes, our program will still be interesting. It will still add value, but it's not going to be as financially obvious most of the time.

[00:09:17] And this approach applies to life as well as business because, you know, realistically, you can only watch one Netflix show at a time, right? You can only marry one person at a time. Well, that's true for most of us.

[00:09:30] Approaching investors with conviction

So when you approach your venture like an investor with that cold analytical outlook and you try to look at it as an outsider would, then if you actually do decide to fundraise, when you do speak to investors, you'll speak to them with a different vibe. You will be kind of different conviction because you're not going to be saying, please fund me. And you know, that's not a good look. Nobody likes that. When you say something like the opportunity before me is huge. This is my evidence. This is why I believe in it. This is why I am investing in this opportunity and I invite you to join me. That's a whole different vibe, right?

[00:10:08] I've told you that people have approached me and asked me to invest in Tech for Non-Techies and I have said no so far. So the reason why people approach me is because I believe in the opportunity. There are so many non-technical founders who want to build tech ventures and in the age of AI, that opportunity is just increasing. So that the opportunity is huge, but also I'm very clear about how we are going after that opportunity. And, you know, a big opportunity with clarity how to attract it, that's very attractive, frankly, to people and to money.

[00:10:46] So here is what I want you to take away from today's lesson. Every decision you make about your venture, whether to build it, whether to fundraise, whether to hire, whether to walk away, that is an investment decision. And the quality of that decision depends entirely on the quality of your thinking before you make it. So the founders who succeed are not necessarily the most talented or the most technically capable, especially these days. They're the ones who ask the hard questions early and listen to those answers. So for example, they're asking, am I solving a real problem for people who will actually pay? Is this the best use of my time and my capital right now? And if it isn't, then what is?

[00:11:36] Action steps and closing

And that last question is the one that a lot of people never really ask because we're conditioned to believe that commitment means pushing through no matter what and that doubt is weakness and walking away is giving up, but it isn't. It's a smart capital allocation and the best investors in the world do it all the time, right? Investors don't just buy a bunch of stuff and just sit on it. They also sell it and sometimes selling it basically means that, okay, I think this stock is never going to recover, so I'm going to sell it for a lower price than I bought it because that's the best thing that I can do right now.

[00:12:12] So if you want to learn more about this, listen to last week's episode when I talked about what happens when you walk away from your idea. So whether you're sitting on an idea that you're excited about or one that you're secretly starting to question, I want you to put your investor hat on. I want you to be rigorous and I want you to be honest and trust the data more than your excitement. Because this is how you build something that lasts. And again, this is something that I talked about in last week's episode. So if you haven't listened to it, it's super relevant to this.

[00:12:48] And if you want a framework to help you go from idea to market ready product, then the Tech for Non-Technical Founders program is exactly where to start. And you can find out more at techfornontechies.co. And if you found today's episode useful, and if it made you think differently about how you're approaching your venture and your time, then please do share it with somebody who needs to hear it. Because it genuinely helps the show reach more people like you and spread this knowledge to a wider smart audience. And on that note, I'm going to love you and leave you. Have a wonderful week. I shall be back in your delightful smart ears next week. Ciao.