No Means Next
Overcoming Rejection and Building Strong Investor Relationships.
Source of motivation
“We have two lives, and the second begins when we realize we only have one.”
― Confucius
Startup Discovery Digest
Yumari’s focus is on cross-border logistics and international commerce as they build the B2B business of Alibaba in Spanish speaking Latin America, connecting buyers and sellers across the region. (Pre-seed, Mexico)
Figuro is a technology-driven insurtech firm that aims to revolutionize the insurance industry in Latin America by harnessing the power of data and technology to transform how insurance is purchased, sold, and created. (Pre-seed, Colombia)
Hey Booster is an AI-powered advertising optimization platform that utilizes data-driven insights and anomaly detection to enhance Google and Facebook advertising campaigns for businesses. (Seed, Turkey)
How to Navigate Due Diligence, and Manage Investor Relations for Early-Stage Ventures
I’ll give a behind the scenes to our process of getting ready and execute due diligence after we say “maybe” to a founder based on the first interview.
Meeting Etiquette and Efficiency: Instead of requesting a meeting, ask direct questions. If your queries can be answered via email, refrain from asking for a meeting, as it would waste the time of both parties involved.
Agenda-less Meetings: Meetings that lack a clear agenda, such as a casual invitation to meet over coffee or a request for information on the startup ecosystem, or the search for a developer or project manager, or a proposal to partner with the company, or a hunt for VCs and partners in the region, are unproductive and lead nowhere. I have had similar agenda-less meetings in the past, but they proved to be inefficient, and therefore, I no longer engage in such meetings.Think of the audience. Having an agenda and sharing before the meeting both allows your audience to be prepared and also communicates to them that you will be prepared.
Ghosting Behavior in Entrepreneurship: Entrepreneurs sometimes exhibit ghosting behavior after initial meetings, or they fail to respond to emails within a reasonable timeframe. After several months, they may suddenly reappear, sometimes with excuses but often without, and try to pick up where they left off. This behavior can be surprising and unsettling. You are always performing and being evaluated. When you ghost, you lose credibility and take stock out of the relationship bank account.
Resistance to constructive feedback: Founders who are defensive, dismissive, or unwilling to consider alternative perspectives may hinder the startup's ability to adapt and grow. Poor communication skills and difficulties in building effective relationships with investors, employees, and partners may arise from this resistance. We don’t expect you to do everything we tell you, but engage in critical thinking and ponder through our comments before jumping into answers, this is not a test. Recommendations are made for a reason. Usually, there is a lot of wisdom and experience behind investor suggestions. Think of it like the tip of an iceberg. Until you understand what is below the surface you are in dangerous waters. Seek to understand what they see that you don't before replying.
Taking negative investment decisions personally: Founders who react emotionally to declined investment proposals may struggle to maintain a professional relationship with investors and could face difficulties when dealing with setbacks. It may be a no with this idea/model/traction, but it may be a yes with your next venture. Why succumb to your wounded ego and lose the relationship?