The role of a lead investor or fund manager post-investment is crucial in ensuring that returns are achieved within a few years. This is done through extending continued support to the portfolio company by overseeing aspects such as market research, recruitment, organizational structuring, and ESOP planning.

Entrepreneurs often lack the ability to focus on closing the condition precedent items that are listed in agreements, which can lead to compliance issues that surface, ultimately this may hinder their ability to scale. It is therefore important to sensitize them on the core aspects of the business to avoid surprises at later stages.

While some entrepreneurs may see financial reporting and analysis as a waste of time, it is actually a crucial periodic check-up that ensures that any loss of direction or planning pitfalls are avoided. The creation of management information systems (MIS) for entrepreneurs to appreciate the results of their execution, trends, and early signals is important for building a successful organization.

Lead investors or fund managers must ensure quarterly reporting to investors, to keep them informed and to seek support in any necessary functions. They also play a critical role in discussing the portfolio companies outside, both for market access and to assess the interest for the next round of investors.

In most cases, a bridge round has to be raised within existing investors, and when subsequent funds are raised, lead and board roles may change. Lead investors or fund managers must protect the rights of existing investors on par with new investors.