Many VCs are known for their mentoring and hands-on approach to founders, particularly those in early-stage startups. The cap tables for early-stage startups is becoming more crowded in this era of lightning fast rounds closing at high valuations.However, this does not mean that VCs have lost their value. This new dynamic forces founders to be very selective about who they mentor. To extract the maximum value from experienced investors at an early stage, it is simply impossible to build deep and meaningful relationships.While founders should pursue large rounds with high valuations, it is important to be aware of the importance of managing who they allow to join their mentorship networks. In the beginning, founders need to ensure that their first layer includes the real doers. These are angels and early investors. They meet weekly or more often with these people to solve the most complex problems.All aspects of the startup's growth, from recruiting to operational challenges to more personal and deeper issues like managing family life while working for it.This is where mentorship really happens. It's where founders can share their vulnerabilities and be vulnerable. This circle must be small and should usually only include two to six people. Managing more people is just too much work and founders will spend more time building the company than managing them.The success or failure of a founder's VC circle can be determined by how they manage it.The quarterly group of investors should be the second layer. This is not necessarily a group of people who are unwilling or unable to take part in the running of the company. However, this circle tends be made up of VCs that make many investments each year. Like their founders they are not capable of managing 50 relationships per week. Therefore, their communication on company issues tends to be slower or less frequent.
