How to Avoid Predatory Investors and Build Real Fundraising Relationships
Written up from #StartupLokal Meetup v.118: Master the Art of Pitching from a Y Combinator Alumni
In this article
Many founders believe fundraising is a quick win: show off a pitch, get funded, and move on. But Henri Suhardja, co-founder and CEO of Titipku (an Indonesian Instacart-like startup and Y Combinator S21 alum), says that mindset is dangerous. He shares hard-earned lessons from his own fundraising journey, lessons that go far beyond the deck.
What to do when an investor demands 51% control
Henri recounts a meeting with a wealthy investor who, after a single handshake, said: "Henri, I want 51% of your company. You follow my orders. If you ask for 10 million dollars, I'll give it to you. But I must control everything."
He left immediately. Not because he didn't want money, but because he recognized the red flag. "I knew right then this wasn't the right person for us," he said.
This isn't a rare case. Many founders, especially early-stage ones, get blinded by the size of the check. But Henri warns: if the investor wants full control, they're not a partner, they're a master. And once you give them that power, you lose the ability to steer your own ship.
"Don't take money if it means becoming a slave."
The real risk isn't just losing autonomy. It's being pressured to break laws, bend ethics, or make decisions that harm your business. Some investors treat illegal acts as routine. You don't want to be in a position where your survival depends on someone who sees murder or jail as a normal business cost.
Why fundraising is not a Shark Tank performance
Many founders imagine fundraising like the TV show Shark Tank, dramatic, fast, and full of instant yeses. But Henri says that's entertainment, not reality.
"That's not how it works. That's not what real fundraising looks like."
In real life, especially in Silicon Valley, the process is low-key. You meet over coffee. You talk. You show your product casually. The investor asks questions. You answer. There's no script, no spotlight. The goal is to see if you're a good fit, not to perform.
The same goes for drama-heavy Korean startup shows. They're fiction. Founders don't cry in boardrooms, nor do they collapse from stress in front of investors. The real work is quiet, consistent, and built on trust.
Join #StartupLokal
The community has been meeting in Jakarta since April 2010. Registering is free and takes a minute.
How to build real investor relationships (not just contacts)
Henri emphasizes that the first meeting should never be about pitching. It should be about connection.
"The first meeting is not about showing your deck. It's about learning about the investor."
You should ask: What's their background? What impact do they care about? What's their investment philosophy? Do they understand your market? Do they see your vision?
This isn't small talk. It's due diligence on both sides. If the investor isn't curious about your business, they're not going to be a good partner.
And relationships take time. Henri has known some investors for eight years before they finally invested. You can't expect an instant yes after one coffee. The key is consistency, show up, stay in touch, share updates, and build trust over time.
"You don't get funded because you're at an event. You get funded because you've been building a relationship for years."
Why preparation beats performance
The moment you think you're ready to pitch, you're not. Henri says the real test comes after the pitch, when the investor asks for your data room.
"A data room isn't just a folder. It's everything: legal, financial, operational, and strategic."
If you're not ready to send it within an hour of being asked, you're not prepared. Delaying sends a message: you're disorganized, unprofessional, or hiding something.
Henri always sends his data room within an hour. Not because he's fast, but because he's ready. He's spent months building it. He knows every number, every contract, every risk.
"If they ask for your data room and you're not ready, they'll think you're not ready to run a business."
A clean, well-organized data room doesn't just prove you're ready, it invites feedback. Investors can see your strengths, spot gaps, and even help you fix them. But if your data room is messy, they'll see only red flags.
Know when the next one is
Meetups are announced in the WhatsApp group.
How to use leverage without getting trapped
Henri warns founders not to sign the first term sheet they get. Instead, get multiple term sheets.
"The more investors who show interest, the stronger your position."
Leverage isn't just about getting a better valuation. It's about forcing investors to compete. But be careful, many term sheets in Indonesia are not real.
"Just because it says '$5 million' in the news doesn't mean the money is in the bank."
Some term sheets come with conditions: "We'll fund you only if you hit $X in revenue." If you don't hit it, the investor can walk away. No penalty. No obligation. They've already lost nothing.
Henri shares a real case: a startup was told to liquidate, go bankrupt, by a VC, even though the business was running well. The investor had the power because of the terms in the agreement.
"The contract is the only thing that binds them. Once they send the money, they lose control. But the terms? That's where they keep control."
Always consult legal and financial experts before signing. Don't sign because you're desperate. Sign because you understand the risks.
Why rejection is not failure
Henri was rejected by over 100 investors in a single year. He got rejections on mornings, afternoons, and nights, sometimes three in one day.
"I was rejected 90 times. I was down. I was tired. But I kept going."
He learned to reframe rejection. Instead of thinking, "I'm not good enough," he started thinking: "This rejection is worth $1,000."
"If I get 100 rejections and one investor gives me $1,000, then each rejection is worth $1,000."
That mindset shift changed everything. He stopped seeing rejection as personal. He started seeing it as data. Why did they say no? Was it the product? The team? The market? The valuation?
This is the growth mindset. It's not about winning every time. It's about learning from every loss.
"One rejection is not failure. It's a step closer to the right answer."
Even unicorn founders in Indonesia, people like Moses from Zendit, have stories of being rejected dozens of times. No one gets funded on the first try. The real test isn't the pitch. It's how long you keep going.
Key Takeaways
- Never accept an investor who demands 51% control or full operational authority. You're not a founder, you're a manager.
- Fundraising is not a performance. It's a conversation. Build relationships over years, not minutes.
- Your data room should be ready the moment someone asks. If you're not ready, you're not ready to scale.
- Always get multiple term sheets. Leverage is your power. But check the terms, many are conditional and not real.
- Rejection is not personal. Reframe it as feedback. Each 'no' is a step toward the right 'yes.'
