Design's Seat at the (Cap) Table: Part II
March 30, 2021
Part 2: the value add design angel investors bring
In part one, we discussed the value of designers getting involved in angel investing. Let’s talk about the other side of the cap table on why it’s important for an investment round to have a designer be a part of it
“Let me know how I can be helpful” is a running joke of dudes (it’s always a dude) in Patagonia vests, particularly in Silicon Valley. I truly when these words are backed with authentic action, it is so impactful and powerful for founders. Many pre-seed companies need capital to keep their idea alive. There are many reasons to have a designer on your cap table; some more obvious than others.
Design help in the product and brand
Let’s start with the obvious one…design. Unless one of the founders is a designer, there’s a chance that early-stage startups haven’t hired a designer yet. This might sound blasphemous, but the reality is a lot of funding in early startups will go to engineering to build the product. The amount of value a designer can guide an early-stage startup. Form Capital is a great example of this. They offer actual design work with their portfolios in the form of design sprints and working closely with founders.
Experience and system design
Experience is key and less visible than working on the startup’s product itself. When you make a decision on something, you’re designing an outcome. Early on, many companies are not prioritizing systems due to the need to move fast. Designers, some of the best systems thinkers, can offer consideration and a point of view that allows you to move fast without facing unintended consequences later on.
The area I’ve observed this to be very helpful is thinking about recruiting and hiring DEI initiatives, and accessibility. There are not things that should be bolted on after you scale but considered from the very beginning. Designers also think a lot about macro-level interaction design, such as journey mapping and user experiences. Recruiting, hiring, and onboarding are some of the most crucial moments as your startup grows, and having a designer think about some of these opportunities add tremendous value.
Many designers also have experience doing customer research, at least enough to be dangerous. This can help amplify product validation of what to work on next while moving quickly. In a world where research is often first in the chopping block, it’s unlikely a founding team has a researcher, and design can bridge that gap for quite some time.
Helping with hiring your first designer
There is no harder role to fill in design than the founding designer at a startup. An angel investor who is a designer fill gaps in your startup. Even with a founder as a designer, they can benefit from an experienced advisor to help them navigate. An advisor has a great network of designers that your company can tap into.
These are a few examples of how a designer can help on your cap table. There’s this quote from the sci-fi cartoon Futurama, “When you do things right, people won’t be sure you’ve done anything at all.” In many ways, I believe this is the value design angel investors bring.
- If you want to learn more, Mike Kruzeniski has a great resource called design angels with really comprehensive information.
- I highly recommend the book “Angel Investing: The Gust Guide to Making Money and Having Fun Investing in Startups” by David S. Rose as a great primer to angel
- Thanks to Hareem Mannan for brainstorming this article with me
- A huge thanks to those who encouraged me to get into angel investing (you know who you are)