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There are more than 70,000 startup companies in the United States, across industries ranging from technology, biotech, direct-to-consumer, fintech and many others.
While U.S. and global markets hold a lot of potential for the business-minded individual, it takes a lot of resources to get a business off the ground. Even then, it often requires financial assistance from lenders or investors to keep going.
I’ve seen a lot of companies come and go over the years, and from my experience, there are several qualities that identify the likelihood of an entrepreneur’s success.
Anyone can have a great idea or a solid business plan, but it takes persistence to take your business idea to the next level. Whether it’s trying and failing in product development or sending dozens of emails to VCs, a persistent individual will seize both good and bad experiences as learning opportunities.
A willingness to learn from mistakes and continually ask questions or seek insight will propel the business toward the future. Persistence demonstrates a will-do attitude that shows VCs and other investors you are prepared to do what it takes to cross the finish line.
Being able to not only outline past challenges you’ve faced, but to document and demonstrate your ability to pivot, learn and improve when needed, shows investors a level of persistence they need to see before moving forward.
You may be a lone wolf when starting on the entrepreneurial journey, and you need to be comfortable with decision-making. Your choices will determine the trajectory of your business and you need to stand by your decisions. You won’t always be correct or make the right choice, but you must be willing to commit to the process.
Your decisions to correct the problem then grow in significance, giving you another opportunity to confidently pursue another course of action. Decisiveness shows investors you’re ready to take charge, pivot when necessary and make the tough choices needed to push through adversity and keep things moving efficiently.
When investors come knocking, it’s important to demonstrate the ability to make the tough calls and stand behind those decisions, even or especially when those choices impact the direction of your team and your business.
As an entrepreneur, you get to break away from the mold of traditional leadership and follow your interests, passions and plan. In order to do this, you must have a sense of curiosity that isn’t easily quenched.
A need to know or a desire to expand will keep a business from getting stale and disengaging from the world around it. Serious investors love to see entrepreneurs pursue answers to challenging questions or explore opportunities with the potential to improve processes, productivity, and long-term potential.
Have you gone to extra lengths to get an answer, increase efficiency or identify opportunities for improvement? Being able to point to specific instances of curiosity — and outline where they took your organization — shows a willingness to reject complacency, go beyond the status quo, and do what’s needed to make their investment worth it.
4. Team building
Good leaders can motivate the people around them, but they are also good at developing and empowering their teams. While the initial steps of entrepreneurship are often taken solo, it’s the diversity of strengths and weaknesses from a larger group that propel a company’s growth.
Demonstrating an ability to put a quality team together with complementary talents showcases your ability as a leader. It also lets prospective investors know you understand the importance of teamwork and what it takes to transform a vision into reality.
Take some time to not only outline your recruitment process but also your ability to identify and secure the best talent for your organization. Showing investors how you build and sustain successful teams, and how you bring people together in the pursuit of common company objectives, is key to capturing their interest and commitment.
If you’ve ever run an organization or held a leadership position for any length of time, you know change is inevitable. The economy changes, the market changes and consumers are notorious for changing their minds and shopping habits.
Entrepreneurship requires facing new challenges or embracing new opportunities when you least expect them. It will be impossible for you to mentally or financially prepare for every scenario, which is why adaptability is important. The ability to rationally evaluate a situation, determine options calmly and objectively, and make adaptations as necessary is crucial to the success of your company.
Remaining static and resisting change may be sustainable in the short term, but it can also create artificial barriers that hide opportunity, stymie long-term growth and send potential investors running for the exits.
Think about any policies and processes you’ve instituted that enabled successful pivots in the past, or that empowered your team to adapt with minimal interruption. Show investors you not only understand the importance of flexibility but also what it takes to shift gears when the need arises.
The sooner you accept the realities of being a startup founder, the easier it will be for you to spend time on what really matters. You aren’t going to be perfect; fortunately, neither is your competition. You will make decisions that don’t turn out so well, and you will have days when you don’t get everything done.
For entrepreneurs, self-acceptance is the confidence needed to keep moving forward and following your goals. It’s the boost you need to try for another contract or make a change in your process. Accepting that entrepreneurship is a journey keeps good business-minded leaders from throwing in the towel when things get tough.
Showing investors the ability not just to identify past mistakes and flaws, but to accept and move past them, helps establish a degree of confidence that their future investment will be put to good use and toward something with real potential.
Although you may have a strong business plan and a great product or service, you need these personal qualities to carry you through life as an entrepreneur. These tend to be what investors look for when considering investment options, demonstrating a level of promise (and potential ROI) they need to see before funding.