Ramesh Raghavan is currently the vice chairman of Business Angel Network of Southeast Asia (https://www.bansea.org/ (bansea)), one of the leading and oldest organizations of its kind in Asia, as well as an early-stage venture investor and advisor in several start-ups. He is an advisor on risk management in traditional public market investments and alternative investments to family offices and emerging hedge funds. Ramesh previously held global leadership roles in derivatives, capital markets, and sales and trading with Morgan Stanley and the Royal Bank of Scotland and has worked in New York, London, Hong Kong and Singapore. Prior to his career in investment banking, he had a fast-moving consumer goods and commodity trading career with multinational corporations. Ramesh holds an MBA from the https://www.london.edu/ (London Business School), a Masters in International Business from the http://tedu.iift.ac.in/iift/index.php (Indian Institute of Foreign Trade) and a Mechanical Engineering degree from India’s oldest technical institution, the College of Engineering, Guindy, Chennai, India.

Worst investment ever

Investor takes first flight as an angel

Ramesh’s first taste of angel investing happened about 12 years ago when a former college friend approached him to invest in an “execution-type business” that seemed interesting even though it was not a fundamentally new idea. Ramesh listened because the guy had been the smartest person in the room at university and had a good work history with large multinational companies. So Ramesh decided to invest his own funds and gather an investing syndicate together because he believed in the person more than the actual idea.

‘Too many generals and not enough soldiers’ raises first red flag

After a few months, red flags began to appear. Ramesh couldn’t see any traction. Communications were worse than the usual poor information flow from start-ups. He couldn’t get clear answers when he wanted to know what was happening with the business, and something he has learned with angel investing since is that people tend to take the money for their business and disappear, only reporting good news and failing to provide updates on the bad. Being responsible to his investor syndicate, Ramesh urged his friend to tell him what was happening and if there were any problems. Finally, he then insisted to see the business plan in which he noticed there were eight co-founders, when three or maybe four should be the maximum. That said, he stressed that there should be one “chief”. He also noticed that all these co-founders had significant multinational experience but that nobody was doing the job. Everyone wanted to get paid but nobody wanted to actually do anything. They lacked the inability to actually get down, roll up their sleeves and actually do stuff.

Time to trim inactive ‘leaders’

Ramesh’s first advice was to fire the loafers and change the whole business model. As the company was not making money, the significant salaries had to be cut to zero. If nobody liked it, Ramesh told his friend they should leave. His friend was unhappy, but after months of pushing, the friend managed to get rid of two co-founders. But issues remained. The company’s leaders still had no key action areas for which each person was responsible. So Ramesh worked with him, nearly four or five hours a session, over about six weeks to figure out how to help him create a viable potential business plan that including setting out key responsibilities for each of the co-founders, who were visibly unhappy at the prospect of doing some actual work.

Remaining team fails to listen to chief advisor

After a lot of prodding and mental anguish, Ramesh’s friend introduced him to the remaining co-founders and they found someone able to be best pitch person from the team to raise more capital, which, after a few months, they were fortunate enough to do. This gave them some breathing room. A lot of the time...