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Entrepreneur Office Hours - Issue #27
Before launching a venture, ask yourself "Why now?", and a conversation with the man who founded EarthLink
In class this week, I gave a talk about a concept that’s key to entrepreneurial success. I call it the “Why now?” Why is now the right time for your venture?
The question is a way of reminding entrepreneurs that entrepreneurial success comes from more than just hard work and determination. External factors about the environment in which you’re innovating will also determine your venture’s ultimate success or failure.
It’s such an important topic, I figured I’d also write an article thinking through the same issue to share with all of you. Be sure to check it out below.
You’ll also find an article that examines whether or not startups should hire straight A students. And my guest on this week’s episode of Web Masters was the incredible Sky Dayton, founder of EarthLink, Boingo, and a half dozen other companies that have all sold for hundreds of millions of dollars.
Not bad, right? Enjoy!
If you don’t have a good answer to why now is the right time to launch your company, you don’t have a good company. Do you know why?
The Coffee Shop Owner Who Gave People Internet Access
Connecting to the Internet wasn't always easy. But Sky Dayton changed that when he created ISP behemoth EarthLink. Hear his story on WebMasters.
Listen now on:
…or search “Web Masters” wherever you listen to your favorite podcasts.
Big companies often use GPA as a way of filtering job candidates. Should startups do the same thing?
Office Hours Q&A
I’m in the middle of my first attempt at fundraising for a startup. I’ve read a lot of what you’ve written about fundraising on Medium, and all that advice has been incredible. So thanks for that.
What I’m trying to figure out is how can I tell if an investor might genuinely be interested in me and my company during a pitch versus just being nice in order to be nice. I don’t necessarily mean if the person wants to invest. I get that he’ll tell me if he wants to invest.
I just mean how can I tell if the investor is at all interested and if it’s worth continuing to build a relationship long term with that person or if we should just cut our losses and move on.
Thank you for your advice,
Early in the entrepreneurial journey, lots of founders begin thinking of investors as some sort of abstract concept rather than as human beings. For whatever reason, in the minds of founders, investors exist separate from regular humans. By that I mean entrepreneurs try to micro-examine every investor action as though those actions should be interpreted differently than normal human behavior.
Based on this question, it sounds like you’re falling into this trap. You’re asking how to tell if an investor is genuinely interested in your startup as though genuine interest from an investor will look objectively different than genuine interest from anyone else in the world.
Investors are just people. Sure, they’re people who might give you lots of money, but that doesn’t change much about how they act. So the real question here is: How do you tell when a person is genuinely interested in you and your relationship versus just being nice?
Unfortunately, my reformulated version of the question might actually be even more difficult to answer than the initial question because everyone is different. There’s no universal rule for identifying genuine relationships. That includes friendships, dating relationships, co-workers, or any other types of close relationships you might develop.
Some people are open about their feelings and intentions. Some people are more guarded. Some people are deceptive. Some people are candid. Even more problematic, everyone constantly changes their behaviors based on whatever is going on in their lives at that time.
Investors are just people. They have good days and bad days. They have preferences and biases. They make mistakes. They get lucky. They are… in a word… human.
Admittedly, I might be reading a bit between the lines, but your question makes me think you’re trying to treat investor relationships different than you’d treat any other relationship.
Don’t do that.
Read the relationship just as you would any relationship. Ultimately, this might result in you misjudging the investor’s intentions or interest. So what? That happens in non-investor relationships all the time. It’s a part of life.
Just as importantly, as with any relationship, be yourself and expect investors to be themselves, too. It might not work out well. In fact, an investor might hate you. But, if that happens, it’s not a bad thing. As in all relationships, better to have an investor dislike the person/company you actually are than to fall in love with something you aren’t.
Got startup questions of your own? Reply to this email with whatever you want to know, and I’ll do my best to answer!