Shortly after the launch of your startup, as an entrepreneur you will become increasingly aware of the need to identify and make a pitch to potential Angels/Venture Capitalists to raise money for your startup. While the founder(s) understands that this pitch requires a credible business plan, often they are completely unaware of other essential attributes which if missing, will result in the pitch being viewed as completely unacceptable by the Angels/VCs. Therefore, given the critical nature of these characteristics, today’s SIMBA Global Startups’ Success Essentials Series will not only reveal to you these attributes, but will also identify actions that the founder(s) can take to ensure that these non-negotiable competencies are readily apparent in your pitch to investors. Through these insights, the probability of a favorable review from the Angels/VCs will be greatly strengthened. But first, we invite you to listen in on a hypothetical conversation among the Angels/VCs as they prepare to consider your pitch. Their deliberation exchange during the due diligence review could go something like this: “Cheryl, do you really think the founder(s) can deliver what they’re promising?; How about you Philippe, do you feel like you can trust the founder(s)?; Will they really understand the terms of the convertible debt?; What about their exit strategy, do you feel they will deliver? Are the founder(s) honest and transparent? They appear knowledgeable, but will they listen to mentoring input and provide honest feedback? In other words, will the founder(s) be mentorable or coachable?”.
From this deliberation exchange it is readily evident that the critical attributes desired by the Angels/VCs in the founder(s), is their ability to listen while willingly responding to advice and implementing the Angels/VCs’ recommendations. At SIMBA Global Startups we call this, the mindset of a mentorable founder. This mindset is an essential attribute which ensures that the founder will willingly accept and implement Angels/VCs’ feedback. In other words, the founder welcomes the opportunity to be mentored by the Angels/VCs through the mentee-mentor reciprocal partnership.
Warning – this can be extremely difficult for you as the startup founder! After all, you have been the person identifying the societal needs to which your startup will respond. You are the person who have formulated the purpose, vision, and product or service which will not only enrich your community, but will provide jobs for those in your community who are without hope and are desperately in need of employment opportunities. You are the person who have been working 24/7 fulfilling the responsibilities of your full time job and now the launch of this startup. You are the person who have been enduring sleepless nights fighting fatigue, exhaustion and the strain on family relationships – all for the sake of this business which has captured your heart, mind and soul. Naturally, you may ask us – are you suggesting that the Angels/VCs “are going to a certain degree dictate what I do in my startup?”. Unfortunately for the founder, our answer is a clear and definite “Yes”, but only to a certain degree! The underlying idea here is that, in exchange for funding your startup, and in accordance with their expertise in your startup’s industry, and performance expectations stipulated in the exit strategy agreement; the Angels/VCs will not only get their money back n-fold, but will also expect to reap credible profit margins.
As the startup founder who will benefit from these funds, it is absolutely positively essential that you have a mentorable mindset. Through this mindset, not only will your startup benefit from the wisdom of the investing Angels/VCs but you will also grow in understanding the success strategies through which the scalability of your business will be achieved from those who have gained these insights through their own struggles and now distinctive success as investing entrepreneurs. It is useful to think of this mentee-mentor partnership as an implied teacher-pupil relationship during which you embark together on an entrepreneurship independent course of study. As with any class, this course has a pre-determined destination achievable through incremental deliverables that determine the highway exit ramp. As the mentee/founder, you are in the driver’s seat during this exciting journey, while the mentor (Angel/VC) is in the passenger seat providing you with valuable navigational coaching input to get you safely to the exit ramp. Although the mentee(s) may receive this valuable navigational input from the mentor(s) throughout the journey, they are still in control and are expected to listen to the mentor(s) navigational advice by providing honest and timely feedback about the needs of the startup.
One of the critical questions asked by the Angels/VCs was: “Do the founder(s) show signs of being mentorable or coachable?”. Remember, the Angels/VCs may have more requests than they can possibly honor at any particular point in time. Therefore, if the startup founder has a resistant and defiant temperament, or is not open minded to receiving mentorship offered by the Angels/VCs, the partnership will quickly become dysfunctional and the availability of financial resources may be at risk. Consequently, it is extremely essential that the founders consider this scenario carefully prior to making the pitch. After all, if the founders are averse toward having an Angel/VC partnership, they have every right not to enter into this mentee-mentor relationship. However, once the founder(s) have determined to enter the post-funding mentee-mentor partnership, they must ensure unwavering commitment to nurture the temperament and mindset of a coachable or mentorable mentee.
Our article published through this platform on August 4, 2020, identified seven essential attributes for the founder(s) to look for in their startup team members. They included: integrity, chemistry, character, competencies, resilience, vision and hope. In a parallel manner when doing due diligence, Angels/VCs have more questions among themselves about the founder(s), that are closely related to these seven attributes which reconfirm the fact that the founding entrepreneur has a mentorable temperament. Therefore, the potential for a favorable due diligence review by Angels/VCs is even more probable when the founding entrepreneur displays signs of the following attributes indicative of a mentorable or coachable mindset:
- Problem Solving
- Paradox Comfort
Let’s now explore what it means for a founder to have a mentorable temperament by each of these attributes.
A mentorable or coachable founder exhibits willingness to change or compromise, not from a point of weakness but from a point of confidence. Flexible founder(s) view themselves confidently even as they identify and recognize their limitations. The Angel/VC looks for evidence that confirms in addition to confidence, that the mentorable founder has a personal growth plan with mature strengths and mitigated limitations. Actions to mitigate these limitations include, but are not limited to intentional partnerships with team members who have strengths in the founder’s areas of vulnerability. Angels/VCs respect the entrepreneur who has the courage to acknowledge limitations while intentionally and consistently implementing actions to close any gaps in their knowledge base. Evidence of consistent implementation of this growth plan gives corresponding confidence to the Angels/VCs that the founding entrepreneur has indeed the essentials of a mentorable mindset and therefore is capable of learning, relearning, and unlearning from their mentors’ input and advice.
A mentorable or coachable founder is someone who is perceptive. Someone who consistently exhibits good understanding of abstract issues which pertain to the startup. The characteristic of perceptiveness is evidenced in the founder’s unequivocal mentorability temperament. This characteristic helps to ensure that the founder/mentee can see between the lines to detect hidden possibilities in problems while correspondingly uncovering appropriate solutions for unforeseen opportunities. The perceptive mentorable founder also tends to display insightful ability and intelligence through which they see possibilities and potential that other people may not readily see. Furthermore, perceptive mentorable founder(s) tend to be good at gathering input data and information from various sources including mentorship and using it effectively in their formulation of feedback as expected by their mentor(s).
A mentorable founder has clarity regarding data informed benchmarks and timelines indicative of company growth and scalability. Accordingly, evidence of an internal drive and persistence not only to meet, but to exceed these success indicators is consistently apparent. Of parallel significance is the founder’s ability to consistently renew their energy as well as rejuvenate the commitment of the workforce to courageously press through challenges such that the optimal strength of the company is achieved.
Leadership at its most fundamental level is “influence”. Therefore, the Angels/VCs will be looking for evidence which confirms that other members operating in the founder’s entrepreneurial community, respect the founder(s) and favorably respond to their invitations to partner with them. If during the due diligence period, the Angels/VCs discover that the credibility of the potential founder mentee is questionable, the anticipated invitation to participate in this fiscal mentor-mentee relationship will be immediately aborted. No Angel/VC will create a damaging vulnerability for themselves or their business by partnering with founder(s) of seemingly tarnished reputation.
5. Problem Solving
Angel Investor(s)/Venture Capitalists will seek evidence that the potential mentorable founder has demonstrated skills in effective and esteeming conflict resolution. As founder, it is absolutely essential that a workforce culture for continued product refinement is established through effective problem solving. Uniquely entrusted to the founder and cofounder(s) is the responsibility to solicit workforce engagement and ownership for quality of service and/or production. A culture which rewards each of its members for speaking “truth to power” such that the ultimate purpose of the startup is achieved, is an absolute essential attribute for the mentee and the mentor.
6. Paradox Comfort
A mentorable or coachable founder must give evidence of the willingness to welcome and resolve the expected and unexpected paradoxes that will characterize the startup’s journey. The willingness to confidently and positively accept mentorship throughout the startup’s journey in a manner which is input data informed, timely and effective to gain clarity regarding the next “best actions” for company growth is critical. It is also important to understand that mentorable or coachable founder(s) will consistently tend to evaluate short and long-term tradeoffs that may seem paradoxical at the moment in time. In accordance with the expression that “timing is everything”, it is equally essential for the founder to recognize that hesitation can give your competition an opportunity to capture the market’s competitive edge. Therefore, as a founder, you must be resolute in informing your intuition with a careful review of seemingly paradoxical, yet relevant input data. Then move forward with the decision which aligns with the preferred business outcome. Finally, recognize that navigating through paradoxes is the norm, not the exception for the startup entrepreneur. This fact is paradoxically illustrated nicely in the following quote: “If you want to be successful, you need to be comfortable with holding contradictory thoughts in your mind at the same time – Ayodeji Awosika”.
Angel Investors/Venture Capitalists expect a mentorable founder/mentee who has the ability to identify, establish and deliver on business priorities. Not only will these effective project management attributes empower the success of the founder’s startup, but the founder(s) with these characteristics will also model for the workforce, the needed exemplary standard for the startup’s cultural success. As a result, the business norms of punctuality, timeliness, internal and external benchmarks, quality control metrics and the “no excuses mindset” are intentionally established while correspondingly affirming the founder’s reliability as an entrepreneur. These essential attributes will give credibility to the founder’s pitch as essential for a mutually rewarding mentee-mentor relationship between the Angel Investor(s)/Venture Capitalist and potential founder mentee(s).
- Create a personal growth plan identifying your strengths, limitations and actions that will affirm your strengths and mitigate your limitations. Be sure to document situations when you have had to change your course of action from one you had originally settled on. Additionally, ensure that this documentation contains copious specifics on lessons learned and insights gained through this flexibility.
- Identify the key data points by which your intuition specific to growth opportunities for your startup will be informed. Include the most compelling data in your Angel Investor(s)/Venture Capitalist pitch.
- Create a 7-point list of daily affirmations that you speak out loud each day by which you empower your ability to persist through the challenging rhythms associated with the launch and growth of your startup. For example, this daily 7-fold affirmation could be: I can do this; We will be stronger through this; I am capable; I am confident; I am credible; I am resilient; My startup will make a positive difference in our world!”
- Make and adhere to a personal commitment to limit personal and social media posting
to only those items that are positive and esteeming. In this world of global technology, you can be sure that the potential Angel Investor(s)/Venture Capitalist will do an internet search to confirm whether the reputation of the mentee-mentor is consistently enhancing and enriching.
- As you prepare your pitch for the Angel Investor(s)/Venture Capitalist, be certain to identify and include examples of your problem solving protocol and the impact of this decision making framework by which the launch and growth of your startup are sustainable.
- Keep a journal of the insights gained from paradoxes that you have effectively or ineffectively experienced from the launch through the growth trajectory of your startup. Share these insights with the potential Angel Investor(s)/Venture Capitalist so that a mentorable mentee-mentor relationship is intentionally affirmed.
- Make a personal commitment to be a reliable entrepreneur/founder. The reliability that emerges both in the entrepreneurial community and the Angels/VCs network will be invaluable not only for enhancing the probability of the favorable review of your pitch, but also will position you for a most esteeming mentee-mentor relationship.
NOTE: As a reminder, SIMBA Global Startups offers mentoring assistance for the design and implementation of the above Call-To-Action formulation to qualified entrepreneurs. We invite you to review our qualification criteria at our website: https://simbaglobalstartups.com/entrepreneurs/
MENTORING MOMENT: York Zucchi, Swiss born global entrepreneur
When it comes to developing a receptive mentorable mindset, the distinguished entrepreneur York Zucchi offers the following insightful mentorship to the new business owner:
“Stop and listen to your surroundings – they are full of valuable information that you may overlook in your daily rush”.https://medium.com/@YZP/stop-being-busy-being-busy-advice-to-entrepreneurs-df8837377926
NOW Just IMAGINE!