Chapter 5 - Investor Management
IN THIS LESSON
Keeping Your Funnel Hot
The one thing that will cause you to lose deals with investors is moving slowly. You may think you have all the time in the world to follow up with potential investors, get your financial projections ready, schedule the next meeting, and contact more investors. Wrong!
As the head of a start-up, you need to be moving at the ultra-fast speed of investors. The speed of doing business – doing the deal with an investor – is only getting faster. You need to show investors that you can move at high speed; you are hungry to grow; and you have what it takes to deliver results.
If you were a basketball player playing under the high pressure of the NBA Finals, you would have to catch a hard pass of the ball, come off a screen, do quick footwork, dribble at lightning-fast speed, find your opening in a crowded space, and take the shot with confidence and alacrity to win the game at the buzzer. Swish!
As an entrepreneur, you need to have this kind of intensity and focus every day to do three things that you are called to do as a business leader to keep your funnel smoking hot:
Keep prospective investors excited.
Make rapid progress contacting investors.
Be well-prepared with your information that investors care about – now they want to see it (like a last-second shot to win the game, figuratively speaking)
Be relentless in contacting people. Sure, be respectful of people’s schedules and don’t be a stalker, but you need to be ultra-proactive. Follow up, follow up, follow up! Get the next meeting scheduled ASAP.
It’s also important to always be ready with everything that you think you might need for a meeting with a prospective investor. You don’t want to be spending a few days or a week getting your financial projections ready.
Just as in a basketball game, time runs out. If you keep a potential investor waiting, you could lose the deal. You need to put aside the excuses; this is not grading school when you might have gotten away with “the dog ate my homework.” Competitors will eat your lunch and snatch investors away from you if you procrastinate. You’ll be knocked out like an NBA team being swept in a seven-game series in the playoffs.
We tell you this truth, not to discourage you or demotivate you, but to give you a reality check that, as a start-up leader, you need to set the pace. You need to be in the same game as the investors. Take the shot. You are in it to win it. Keep your investor funnel hot.