Placing Bets: Person or Product?

Rines Angel Fund
4 min readOct 26, 2023

By Jocelyne Bisson ’24 Director of External Relations

The angel investor mentality is best defined by the phrase, high risk, high reward.

Angels look at companies in the earliest stages of development. For a company to even have a chance at high profitability, someone must support it when it’s young. Sometimes, a founder has only an idea or concept, a single prototype, a few interested or paying customers, or is made up of a team of one. Throughout my time in Rines and while working with 10X Venture Partners, I’ve seen pitches from founders with companies as young as a year old, and others with years of experience and multiple pivots behind them. The point is, angel investors make a bet, and that bet is placed when the company doesn’t even know what it will become. So, how should investors decide where to place those bets? Further, if a company is unlikely to remain what it originally began as, then why invest in a product, when you could invest in the founder instead? It’s the whole idea of investing in the jockey and not the horse, and it’s an interesting question that angels should consider when making investment decisions.

Marketing and competition are fundamental pieces of any due diligence process and provide the first reason to invest in a founder rather than a product. Industries are almost always highly saturated, and if a product or company really solves a problem, or is looking to fit into a specific niche, it’s unlikely to be the only one trying to do it. A Forbes article highlights this concept and talks about how accurately predicting the long-term conditions of any industry is nearly impossible. In short, a product or service is going to change if the company is successful in the long run, because the industry will change. Things are not going to go exactly as predicted, and for a company to be successful, having the ability to shift to fit an ever-changing market is so much more important. A founder who can roll with the punches will be better equipped to compete with competition, and if their product or service is successful, new competitors are going to be impossible to ignore.

Some of the most successful companies today provide an example of this pivoting concept and act as a second reason why investing in a founder over a product may be a stronger way to make investment decisions. Twitter, Play-Doh, Instagram, Nintendo, Starbucks, Airbnb, and YouTube are just a few examples of massively successful companies that don’t do what they originally intended to. Each shifted and pivoted based on where they could find success and profit in the marketplace. These companies were able to stay alive and eventually thrive because they were able to transition. An investor who put their money behind Nintendo for example, is certainly happy now even though the company may not have become what it was originally intended to be.

Of course, there are limitations to this theory. The best founder in the world might have a truly terrible idea. The original concept or product still needs to have strength, and as with any due diligence process, various factors hold different weights in the final decision. The bigger question is what defines a good founder as opposed to a bad one? My ideal founder might have significantly different strengths and weaknesses from someone else’s. Are these founder strengths personality traits, prior successful exists, or education and background? Further, how much can really be understood about a founder during a single pitch or Q & A session? Maybe some industries require a stronger base product, while others need a stronger founder to break into a crowded space. Either way, both the founder and the product hold importance, the question is just how much.

In Rines, we debate on this topic all the time. When looking at the team, it seems our class is always divided on how much importance their strength holds in a final investment decision. I personally feel that a founder with multiple successful exits behind them should be considered completely differently from one starting out fresh. In addition, I’m likely to support an investment in a company that needs a few product adjustments if its founder is strong, because I believe that founder is actually capable of making the changes and keeping the company afloat in the process.

The question you should be asking is, if Bill Gates proposed a mediocre product, and I, a first time and inexperienced founder, proposed a great one, who would you choose to invest in, and who would be most likely to take that product all the way to a successful exit?

Jocelyne is a senior from Manchester New Hampshire majoring in Marketing with a minor in Political Science. She previously served as Director of Marketing for the Fund and is excited to be taking on a new role working with startup founders as the Director of External Relations. She serves as a liaison with one of the Fund’s outside partners, 10X Venture Partners, and has continued her previously full-time marketing and communications internship with GoodWork Seacoast, a Portsmouth based nonprofit incubator program. Outside of the Fund, Jocelyne works as a writing assistant at the UNH library, and volunteers through Alpha Phi Omega, a UNH community service co-ed fraternity. This past spring, she spent a semester abroad in Verona, Italy, and enjoyed traveling Europe while learning about Italian culture.



Rines Angel Fund

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