How ‘Being Nice’ Helps Start-up Founders Secure Relationships with Investors

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Investors are quite particular when it comes to their criteria of what qualifies a new investment opportunity in a start-up company.  Accredited Investors, Family offices, Individual Investors and venture capital firms are looking for sustainable plus scalable business models with great people behind them. How one defines a great person in life is the same as investing in great people professionally. Google defines a great person as a person who is trustworthy, kind and thoughtful. Recently, billionaire Mark Cuban shared that ‘being nice’ got him further in business plus was the glue to building lasting relationships with associates. The idea of ‘being nice’ can be taken steps further to display that being kind is the behaviour of having polite manners. Manners is a conversation that is seldom heard of anymore in our morally eroded ethically-driven society. However, be cautioned in the business world having good manners is a must to having doors opened or shut solidly in your face, especially if you’re a founder seeking an investor for your start-up.  

One of the biggest pet peeves shared by serious investors is meeting with a potential founder who does not value their time. Be precise and punctual. Some founders show up for meetings way to early or too late. If you are late, don’t even bother coming to the meeting. You should consider the investor at that point will be uninterested that you did not value their time. Plus, you reinforced that you are unreliable and unable to arrive timely for your commitments. Unless you have a legitimate reason for being late such as a car accident happened at that moment or you got a flat tire paired with a random act of God. Only under those circumstances would there be a permittable reason to call the investor to reschedule either later that day or another day.

Also, be precise. If you are arriving at the meetimg early don’t announce yourself at reception until 2-5 minutes prior to the appointment time. If you do arrive earlier than 2-5 minutes get yourself a coffee or go to the restroom before letting reception know you arrived. Nothing is more unnerving than having someone’s anxious energy hovering over their front-line staff. Allotted you are waiting for your appointment at reception, the daily business at the office will resume naturally. Depending on the layout of the firm, no one wants someone being privy to their daily practices. Show discretion. What happens at the investor’s office, stays within the investor’s office. All information overheard must be privy to no one.  

Another mind-boggling dynamic are founders who are not prepared accompanied with poorly outlined presentation materials. Each potential start-up must have an outlined business plan minimum 25-32 pages (including the cover pages, summary and table of contents). Some investors have shared they are baffled at the audacity of founders who are requesting millions of dollars but showing up unprepared by missing pertinent information such as all the financial details or can’t explain their financial plan at all.  Investors want to know outright how they are going to get their money back in a two to five-year timeframe. They want to know your inspiration for founding the company, your team, the story behind the products or service. Also, make your presentation not just sound polished but look polished too. If your brand looks disorganized in the presentation, the investor will assume you are incapable of being organized to run a company and convey the messaging around the brand with clarity. The way you present your presentation materials matter. The product/service matter. Your team matters. Relationships matter. Bring value by showing that you are invested in the small details just as much as the larger important details.

Some investors mentioned what they are also perplexed by is the inability for some founders to establish rapport early on. Although, many investors try to research the potential start-up, founder and review the documents submitted beforehand. Many have found some founders don’t research their investors at all. Some investors went as far to say they are insulted when a founder is seeking them for money but doesn’t have the slightest inkling of knowledge about who they are and what types of sectors drive their investment motives. This should be business basics 101. But for many founders it is not.  The resounding advice is get to know your potential investor. Most people have access to the internet on a multitude of devices. If you’re an early-bird showing up at an investor meeting; take that opportunity to research a little about the investor. This way when you enter the meeting you will have talking points. Laying the foundation for the investor/founder relationship is key to building rapport by sourcing easy and accessible information on the internet. The upfront research on the potential investor makes you aware of any commonalities need engage and impress the potential investor. It shows you did your research. The first two to five minutes in the meeting can be geared to learning more about your potential investor prior to jumping immediately into your presentation. That’s unless the investor has placed time constraints on your presentation.  If the investor has time constraints, honor the commitment by conveying your message at a concise pace with clarity.  

Lastly, be nice. Understand that many investors have seen a plethora of business ideas come through their office. Be humble enough to acknowledge, although your idea may be a great, not all investors will invest in your business model. Accept that it’s ok if someone doesn’t see your vision.  Keep in mind that if a potential investor does not resonate with your plans, be respectful especially when receiving constructive feedback. Give yourself the opportunity to learn what you could have done differently. Also, some potential investors may refer you to another investor who could possibly be more aligned with your business model. One investor we interviewed shared, she declined a business plan that was missing the financial plan entirely, only to be met with aggression and petulance from the founder. Consider that type of negative behavior as a burned bridge. Burning bridges is a serious faux pas in the VC sphere. The investor network is a very well-connected, insular community where many people know each other. Burning one bridge could potentially leave you burning all bridges in that community. As the founding leader of your start-up, you should be able to display solid business acumen about your business model and message followed by decorum with your attitude.  The potential investor is investing in you first; your business second. If potential investor likes you along with you have a solid business model, you are already more than half way to confidently being funded.