I get bored and cynical every time I read a blog post from a first-time entrepreneur who has “discovered” the 7 amazing secrets to entrepreneurial success. Usually their amazement is because they were so inexperienced in the first place, and some basic truths about business and entrepreneurship never occurred to them in the first place. Much like how an 18 year-old living on their own for the first time is amazed to discover that ‘if you don’t pay your rent on time, the landlord will evict you.’ It’s an important lesson, but hardly an amazing secret that now qualifies them as an expert.
So many new entrepreneurs self-anoint themselves an expert because they’ve started out so clueless in the first place. Expertise is not measured in the difference between zero knowledge and what you have just learned – expertise is what you know more, or do better, than the majority – or better than other experts.
OK. End of that preemptive rant.
Now an exception. Today I read a blog post by an entrepreneur who endured a very common and frustrating entrepreneurial experience: Trying to secure venture capital. This is an interesting case where – the more experienced you are, the less useful your advice will be to others. For example. If I’ve successfully raised venture capital 10 times in my life, then for my next venture round, I will probably pick up the phone and call a few VCs on my rolodex, meet a few times at starbucks to discuss terms and the size of the check. My experience, and advice to newbies will be worthless and irrelevant.
Here, with a perceptive “beginner’s mind” Corrine Sandler, CEO of Fresh Intelligence offers some lucid insights as to the fundraising process that are particularly valuable to first-time entrepreneurs: Not so much in how-to raise capital – but rather for insights into the many other subtle aspects of the process that can drive a newbie entrepreneur crazy.
Would I do it again? Never say never—but not on anyone’s terms but mine. Let the VCs come knocking; until then, I’ll carry my own bricks and build my own home.
Top five lessons I learnt when dealing with Venture Capitalists:
- If they ask you to change your business plan to get dollars? Walk away.
- If they focus on year 1 revenue and not the concept? Run away.
- If they think they have the power, because you need them? Hide away. They must want you more.
- If you find yourself celebrating a term sheet arrival more than a sale—you have lost your way.
- If your original vision is disappearing in the rearview, and you don’t like the looks of the landscape ahead—grab the wheel. It’s your way, or the high way
I could not have come up with more spot-on, wise advice than this.