From supporting hundreds of founders over the years, and from having launched more than a dozen ventures myself, I have noticed a trait that separates the successful startup founders from their failing counterparts. It is about the mindset of WAITING.
Have you ever heard sentences like (or uttered them yourself):
“We are waiting to hear back from a potential investor”
“We are waiting for a big partner to sign LOI so that we can market to their customers”
“We are waiting to get the right salesperson on board, then we can grow a lot quicker”
At a first glance such sentences might seem totally reasonable. It can often be the right choice to get an investor on board, to partner with a big company for rollout, and to hire someone to help with sales. It is the “waiting” that is the problem.
As startup founders we are never waiting for anything or anybody. There is always something we can do right now, based on the possibilities that are available to us in this moment.
Far too often a startup founder has a good investor meeting, and then assumes that now he can move on to other tasks and wait for the investor to sign the check. This is just one example of the dangerous waiting mindset, but let’s have a closer look at it.
An investor will typically evaluate 50-100 startups before making 1 investment. Most investors want to be nice (just like everyone else) and don’t like to say no. So they say something like “this looks very interesting, I will be happy to follow your progress and let’s talk soon again”.
The founder, eager for some progress, can interpret this as a good sign. In reality it can just as well be a polite rejection. If the founder is now waiting for the investor to get onboard it is a recipe for disaster. Even if the investor is really interested, we should never put all our eggs in one basket. Many startup founders slow down with their investor outreach when they have had what they believe to be a good investor meeting. Their logic is not to disappoint anyone, and give the investor the time to make up her mind, before moving on to pitching the next one. This is a big mistake. Rather use the positive energy from a good investor meeting to immediately reach out to 10 more investors. This is the way you build momentum. You want investors becoming afraid of missing out. You want too many potential investors being interested because otherwise you will be weak in the negotiation process, and things will drag out. Never beg or harass an investor, it won’t work. Instead reserve your right to flirt with lots of potential investors, until the very moment that the money is in the bank. The investor will surely flirt with many other startups, so this is the only way you can keep the power dynamic somewhat balanced.
Of course, it is totally possible that you are not ready for investment yet. If 10 investor meetings all end with them telling you to get some more traction first, then that is what you should be doing. You might not have to do a 10x of revenue as they suggest, in reality a quick 3x might shift their sentiments. If this is the case, then the question becomes how can you improve your traction without having access to (much) capital. That calls for creativity, definitely not for waiting.
There is no waiting in this game, there is only intelligent and empowered action.
Next time we will look at the misunderstanding of waiting for a big company to partner with.