In this fireside chat with Parna Sarkar-Basu, David Chang discusses his journey from his first startup to raising $150 million and returning $750 million to investors. He emphasized the importance of team, product, and market fit for early-stage investments. Chang highlights the critical growth stages from $1 million to $5 million, focusing on building a go-to-market team and scaling operations. He tip for founders include identifying key factors for growth and hiring the right talent. Chang also stressed the importance of non-monetary motivations, like career development and mission alignment, to attract talent. Finally, he recommended founders to focus on de-risking key business aspects to achieve the next level of growth.
Key Takeaways:
Scaling from $1M to $5M Requires a Mindset Shift
What worked in the scrappy, early days won’t fuel the next stage. Founders must invest in building teams, processes, and customer acquisition strategies beyond their personal networks.
Early-Stage Investing Hinges on 3 Core Questions
Investors look for:
- A team with a differentiated edge
- A product that truly solves a pain point
- A market big enough to support long-term growth
Founders Must Know When to Get Out of Their Own Way
Bringing in experienced talent—especially non-founder sales leaders or senior operators—is key when tasks become repeatable and growth stalls without scale.
Hiring Mistakes Often Come from Misaligned Expectations
Don’t just hire based on resume pedigree. Look for people who want to operate at your current stage, not just those who have done it before.
Motivation Goes Beyond Equity
Candidates are drawn to purpose, impact, and the promise of growth—not just a paycheck. Founders should highlight these elements during recruitment.
Know Your Strengths (and Your Company’s Limits)
Startups—and founders—have “sweet spots.” Growth happens when you lean into your strengths but stay honest about when to bring in reinforcements.
To Increase Valuation, De-Risk What You Haven’t Yet Mastered
The biggest valuation jumps come when startups tackle new areas of uncertainty—be it team, market, or product readiness—not just perfecting what they’ve already done.
David Chang is GM of Expert Network at Hunt Club and a founding member at TBD Angels. As an entrepreneur and angel investor, he has held operating roles at six startups and invested in 100 companies. He was recently the CEO of Gradifi, which was acquired by E*TRADE. Previously, he was Entrepreneur-in-Residence at Harvard Business School and Director of the Babson Summer Venture Program.