2 Subtle Green Flags of Winners + Fundraising Fieldnotes 05.20.25

How Showing the Right Type of Focus Can Catch an Investor's Eye

Author

Jason Yeh
May 20, 2025

 

I always stress the importance of understanding what VCs are thinking. It helps you consider ways to craft your pitch and gives you context when negotiating deals.

To help with that, my friends at Gunderson Dettmer sent me their 2024 Venture Capital Report to share with yall. It’s an amazing resource to understand how VCs are thinking today, so check it out.

Gunderson Dettmer is a top-ranked law firm focused on representing venture-backed companies and global funds. They provide strategic legal guidance tailored to each phase of growth and have been recognized as the #1 VC law firm globally by PitchBook for 11 consecutive years. They also happen to be the firm I worked with for my last venture-backed startup!

Reach out if you’d like to meet the team at Gunderson, I’d be happy to make a warm introduction.

2 Subtle Green Flags of Winners

If you’ve followed me for a while, you know I’m constantly with founders on all parts of their fundraising journeys. Founders thinking about fundraising, in the middle of fundraising, and after fundraising (both successful ones and failures).

All those reps have given me an eye for things that might indicate founders who will be successful with their company and fundraises. Often small things like how a founder talks, what they emphasize, what they’re honest about, and what they don’t overhype can reveal a ton about what’s ahead.

One of my favorite times to exercise that eye for founders is at my Dawn Patrol events. The events are great because in between emceeing, I get to roam around, ask questions, give feedback, and generally just listen to the cool projects founders are working on. The added bonus is I also get to pick up bits of content to include in my newsletter :)

That’s my MC stance…. (Dawn Patrol in Los Angeles, March 2025)

At the last Dawn Patrol in LA, I had two short conversations where founders said things that made my mind go “DING DING DING! GREEN LIGHT!! ✅✅”

On the surface they’re pretty innocuous, which makes them even more interesting as vehicles to teach. So I’m excited to share them with you here.

Green Flag #1: “The name doesn’t really matter.”

This one was such a throwaway comment, but it really stuck with me.

I was in the middle of a founder’s explanation on how his building-climbing robots were a big business opportunity when I realized he didn’t say what his company was called.

I asked, “Wait, what’s your company’s name?” 

He responded nonchalantly, “I dunno - we haven’t really named it yet. The name doesn’t really matter.”

It threw me off for a second, but honestly… I loved it.

Founders like this show they’re interested in substance rather than optics. They aren’t trying to project startup theater. They’re not spending their energy crafting the perfect name, doing trademark searches, buying a .com for $20K, or obsessing over the color palette on their Notion page.

They’re building. They’re testing. They’re talking to customers. 

When I hear “We haven’t really settled on the final name yet,” or “Honestly, we don’t love the name, but we’re focused on validating the product right now,” I immediately think:

Ok, this person is actually running a real startup. They’re not just playing startup. 

It’s cringe to share this, but part of why I know this is so important is that I made those mistakes early on at my first startup. I had come out of the consumer world, where branding can make a difference. I let that influence me, so we stressed for weeks around a name that was clever, was easy to remember, had a good URL, made for a good logo… all of those fun things …that do absolutely nothing to improve a b2b company’s ability to find PMF!  

Early-stage b2b startup building is messy. The best names, positioning, and brand identity often emerge later in the process, after you’ve nailed the product, after users show you you’ve built something useful.

The founders who obsess over naming too early are usually trying to project legitimacy before they’ve earned it. They want to feel more “real” because the business isn’t. The most hilarious part of my story was we did come up with a name that was perfect for the business we raised money for…but the business it ended up becoming was barely related. face palm

So when I heard that the founder wave off the name question? It made me smile. That’s a green flag for me, letting me know they were focused on the important stuff, not surface-level polish.

Green Flag #2: “We’re still validating the customer need.”

In another encounter, I struck up a conversation with a founder who immediately impressed me with a strong story. It was the type of story that showed an intriguing, unique insight that would pique an investor’s interest. 

The lead-in story combined with how much interest I was showing would have made it easy for this founder to keep pushing a narrative that represented much more than he had actually accomplished.

When I asked for details on how he would charge for his product, he responded, “Honestly, we’re still validating the customer need.”

I smiled.

This one might surprise you, because it sounds like it should be a weakness. For me, I take this as an amazing positive. 

When a founder openly admits they’re still validating the customer problem, it tells me they understand how difficult it is to get real product-market fit and what the first steps to that are. I could say more about knowing “the important stuff” to focus on, but that’s too similar to Green Flag #1. Stay with me…

What’s unique about this comment is that it shows an understanding of relationship building and fundraising. To me, it indicates he understood this is a long game.

Tons of founders, when faced with the opportunity to chat with an investor or someone with influence, feel like they need to close right then and there. There’s an urgency that pushes them to pitch and sell and stretch.

On the other hand, a founder who shows up with self-awareness and humility, alongside a dash of intrigue? That’s an interesting person to meet. They’re comfortable with where they are. Because they know if they can show real progress the next time we chat, I’ll be WAY more interested than if they just barely grew into the inflated story they could have told.

The founder showed me he wasn’t there to win anything on that day. He just needed to make a good impression. 

Mission accomplished. Green Flag secured!

The Takeaway for Founders

If you’re early, don’t be afraid to show that you’re still in motion. Investors know the early days for everyone are all about learning, so don’t fake certainty.

Instead, focus on having a sense of urgency, curiosity, and a deep commitment to figuring things out. When you show up with that kind of posture, things just start working.

Be chased,
Jason 

Some of this is about being scrappy, but I like focusing on the part about going back to doing what it takes to learn what your customers actually need…

Hahaha. This makes me laugh. I try to be polite to the robots too 🤖❤️

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