Don’t let your drive steer you down a dead end.
For a startup founder, enthusiasm is a necessary piece of the personality puzzle. You took the leap and started your business because you believe in it. Whether you’re solving a major technology problem, disrupting a stagnant industry or providing a service that will make life more enjoyable, you’ve reached your current level of success because you’re confident in your concept or product. A natural extension of hard work and faith that your ideas are valuable has helped you reach your goals.
There’s no need to sell yourself on what you’re doing because you’re already all in. But that’s not necessarily true of the VCs and other investors who will help your startup get where it needs to go. Startup tunnel vision is one of the few negative consequences of the courage and self-assurance of the entrepreneurial spirit. If you remain too focussed on your confident belief in what you’re doing, it can be difficult to shift gears and put yourself in the shoes of a sceptical investor. It’s easy to believe that everyone will share your enthusiasm for such a brilliant concept, but that kind of confidence can actually hold you back.
There are so many different ways that startup founders can get in their own way and undermine their success. We’ve all seen dramatic examples of this in news stories about bad-boy behaviour, but I’ve seen it happen in much more subtle ones. The boldness that drives founders to dare greatly can cause a disconnect that makes it difficult to get the support you need on your journey to the top. If you can’t widen your focus to include the viewpoint of people who aren’t yet convinced, you’re getting in your own way.
That perspective, the viewpoint of a sceptic, can be an uncomfortable place for a founder to go, but I’ve found that it’s an important part of the fundraising process. Investors want to see that you can offer them value. But if you’re stuck in the confidence-induced tunnel vision viewpoint, you’re likely to miss some key points that skilled VCs, angel investors and even loved ones will zero in on immediately. You understand the value in what you’re doing, but are you prepared to prove that value to someone else?
How To Leverage Your Confidence For Successful Fundraising
Confidence can indeed be your best asset with investors, but you’ve got to use it right. Once you’ve taken your blinders off and widened your focus to include an outside perspective, you’re ready to approach the fundraising process with some finesse. These steps are crucial in converting raw faith into a useful strategy.
Do your research: An ego-driven founder might sit and wait for investors to swarm like bees to honey, but a smart founder knows better. You have to be informed and make smart choices about who you approach, and that means doing a tonne of research to find compatible parties. As you look into potential investors, your confidence will be an asset that grants courage to approach some major players.
Find a pain point: If you think you’re the next big thing, you can use that confidence to hit an investor where it hurts. Research the individuals and groups you’re approaching during funding rounds and find out if they’ve missed out on any big opportunities in the past. Drawing a direct connection between your efforts and someone else’s success allows you to use your confidence to your advantage.
Present an opportunity: Selling your startup as a sure thing can cause some investors to baulk. If you’re already all set, what do you need them for? Most VCs want to find a good team to partner with, and some even actively seek out startups looking for guidance or mentorship of some sort. Overconfidence can be a big turn off in these cases. Plus, it can actually end up robbing you of the opportunity to form a valuable partnership with experts who can help steer you in the right direction.
Build a relationship: Assumptions brought on by tunnel vision can cause founders to come on too strong in initial meetings with potential investors. Instead of charging in headfirst, use your self-assurance as a foundation for making a personal connection. The person you’re meeting may have something you want, but you also have something they want in the form of a great investment opportunity.
Take the blinders off and remember that investors need a reason to trust you, and at this stage in the game, a single-minded focus on your own value can send the wrong message.
Ultimately, confidence is a good thing in the startup game. If even you don’t believe in your startup’s mission, you aren’t going to get anywhere. But it’s a mistake to let your confidence get in the way of your ability to advocate for your ideas and sell your startup to investors. Entering sales mode early and staying there will put you in a much better position for future success. Don’t let startup tunnel vision prevent you from acting as the fierce advocate your ideas deserve.
[This post first appeared on the Business Collective – an initiative of Young Entrepreneur Council, which is a free virtual mentorship programme that helps millions of entrepreneurs start and grow businesses.]