We receive a tremendous amount of potential partnerships, investment and sales requests.
A lot of articles have been written about the reasons, rules or guidelines why VC’s, Angels and even family invests in a company.
This goes from scalability to market size, risk profile, unicorn potential and many more, but 1 thing is something that really put all investors off and that is commitment. This is why many good business plans are just ending up in the bin, because in the financials there is straight away a high-end salary, lease car, pension plan and expenses. When we see this in a plan, we often see a great CV, worked for an even better corporate and wants to go on his own, because they were tired of the management and rat race. That group we immediately advice to stay with a corporate, because they have no clue what an entrepreneur does to survive.
The commitment of an entrepreneur is scary, he risks his family, house and friends to ‘play the game’. Yes it is not even the money they make or going to make, they wake up and hunt their dream, their passion. They break all boundaries, all common business book rules to pursue their dream. The tenacity to follow through, the willingness to learn more and to do whatever it takes is basically one of the most critical elements in investing in that person.
The aunt of Richard Branson took an extra mortgage on her house, because she believed in him. Sometimes we don’t even understand the real concept behind the people, like what happened with Google. There 1st 100K came from a person who felt they were doing something special….that’s not an investment guideline rule. With Tesla we have another entrepreneur, Elon Musk who goes all the way….to Mars and people believe he can pull it off.
When there is some commercial traction in the company, the founder already suffered a lot of set backs and people who get involved look at that. They meet with the entrepreneur and the commitment to succeed is so evident and the will is so big, they are willing to throw in the kitchen sink if necessary and eat dry bread. They love to ‘play the game’ and yes a lot of those people who are tremendously rich now are still all in when they see that ultimate opportunity. Take Steve Jobs, who lost everything again with NeXT and Pixar. You can be talented, you can be willing, but you need to have tenacity. Every entrepreneur can tell you how great he is but every entrepreneur knows he had to give it all and I can also tell you there were a lot of really bad days on the journey.
I recommend everyone to be an entrepreneur, I think the freedom and pursuing your dream is one of the highest joys in life. I also emphasise all those people, it is not a free ride. We dive in really deep, we go all the way and than stretch it a bit more and even than we hold on too long, when everyone already steps back the real entrepreneur still pursues their dream and their passion. Against all odds that entrepreneur will find a way in his life, even if the 1st, 2nd and 3rd attempts have failed.
That’s commitment and you are either in or out!