A myriad of entrepreneurs, who have amazing personal stories fueling their innovative mind-training enterprises, approach me seeking investment and counsel. Bridge Builders Collaborative loves the entrepreneurial spirit. We are impassioned by supporting great ideas and entrepreneurs in scaling innovation for a healthier, happier world. I have a lot of respect and compassion for entrepreneurs seeking investment. It’s not easy.
After seven years of intereacting with hundreds of entrepreneurs, I’ve compiled ten tips on how to approach our Collaborative. Maybe it will be helpful for other investor pitches. I’m hoping this makes fundraising more productive for entrepreneurs.
- I like to start conversations with entrepreneurs by asking a question about their personal journey. I want to learn more about them and what drives them. The more they are willing to be vulnerable and authentic, the more I’m interested in learning about their endeavor. I am seeking to build a relationship. Many people think we invest in businesses — but that is only part of the story. We invest in great people whom we believe have the capacity to scale a mind-training company.
- I’ve had several experiences where CEOs have spent 40 minutes talking about their business, without a pause or checking in with me. Since I’m looking for a relationship, this approach doesn’t work. I can “Shark Tank” a business model in a few minutes to determine preliminary interest. What I want is to get to know the leader and have them get to know us. Ask us questions. Engage us. Pause, and include us. We are looking for partners.
- Many CEOs believe they need to have all of the answers and need to be right. I appreciate when people have experience they bring to their business and also know they don’t have all the answers. I want to discern their ability to be curious, their willingness to not be right, and their openness to others opinions.
- Come with some knowledge about us. We are passionate about this space. If you don’t have questions about us, then I assume you’re just wanting our capital. We view capital as our least valuable resource.
- Please don’t presume I’ve read the deck you sent. Usually I have, but I’m interested in hearing you tell your story anyway. Leave plenty of time for questions.
- Once, a company sent me a pitch deck that predicted they’d achieve $2 billion in sales in just 3 years (for a hardware product). Six years later, I think they’re generating $3 million. I’m all for optimistic approaches. However if the approaches are not defendable, there’s little chance we’ll pursue.
- I want to know how much you and your team are experienced in the business model you’re trying to pursue. For instance, I have not yet met an entrepreneur who has accurately predicted how long it takes to get a product into a health insurance company or a health care system. I want to know if you have a general understanding of how those systems work if you’re going to sell to them.
- We are not fond of B-Corps. We believe if a company has a powerful mission statement and strong core values, a B corp structure is unnecessary. Typically, a B-Corp is meant to enable board member to make decisions that reflect social and shareholder considerations. Given today’s marketplace, we increasingly see customers buying products and services because of a mission. So if your board makes decisions that deviate from your mission, the marketplace will react promptly and harshly.
- When I see start-up CEOs with a fantastic mission and a goal of starting a non-profit arm or giving a bunch of money away to non-profits, I take a deep breath. And then I take another deep breath. Then, I share my perspective. If you have an incredible mission, you don’t need to give money away to non-profits, or ask your investors to give up their return so that you can give money away. You’re already changing the world. I love strategies that give away the brand experience to people who can’t access or afford it — Toms is a great example. However, giving money to other non-profits is a red light for me.
- Back to relationships. The chance of success with an investment pitch is pretty low. I’ve reviewed several hundred plans and we’ve made 10 investments. However, I’ve built collaborative relationships with many people in the space. As this space grows and as innovators merge and consolidate or partner, the value of having a good relationship is beneficial for both of us. I’m happy to get to know you without attachment to an outcome. Opportunities naturally emerge over time.
Regardless if we invest, we are supporters of the entire field. We love to collaborate, and we wish you great success even if you’re not a fit for us.