I’m going to excise the important lessons learned from the Forbes article 300 Investor Rejections And 1 Failed Startup Led This Entrepreneur To Build A $1 Billion Business by
Here are his lessons learned along the way, which I heartedly endorse, both from my own personal experience as well as experience mentoring dozens of founders:
Three Essential to-do’s
- Surrounding himself with good product engineers
- Really getting a handle on product market fit
- Learning how to talk to investors
If he was to ever start again:
… he would spend a lot more time thinking about and vetting an idea before jumping into it. Spend a lot of time talking to customers or potential customers, and also talking to investors, and really starting to define and refine the business model, the customer acquisition strategy, the business model, the defensibility, the network effect.
- He had to go from fundraising in California to New York where investors got it
- He learned the secret isn’t convincing investors, it is finding the investors that love the idea
- Learn to leverage a lead investor who will syndicate the deal to others
- Learning some sales skills
Ward had about 300 turndowns from investors for his two startups! But his second point is perhaps the most important lesson learned about raising capital: it’s all about investor-venture fit. Founders tend to think that by getting more meetings, sending more emails, making more phone calls – whatever, more is better – they can convince an investor to fund them. No! If you don’t get resonance from the first two meetings move on! Take that energy and your precious time and dig for a well elsewhere, digging deeper and deeper won’t strike oil! Of course, this assumes you have heeded Ward’s start again tip to talk with investors before you jump into a venture. You have studied their portfolio and talked to some founders they have invested in – performed your due diligence on prospective investors.