Dr. Earl R. Smith II

I am very interested in collecting stories about founder interactions with investors and lining up additional interviews for future articles. Please take a read and post your comments. Thanks in advance for your help.

I have been doing a series of interviews for articles on angel investors and venture capitalists. I am focused on describing how they approach the process of deciding whether or not to invest in companies.

There is an old maxim – wanting and having are two very different things. I recently wrote about a client who had that experience.

I frequently run into teams who have been ‘on the road’ for what seems to them like years. They have been chasing investors and having nothing much to show for it except a series of polite rejection letters or e-mails.

I am frequently approached by founders who are seeking investment. One of the most striking characteristics that many of them share – no matter where they are in the funding search – is a dysfunctional view of the process and what it takes to win funding.

I have worked as an executive coach for a couple of decades now. One thing I have learned is that over-thinking situations is often the reason that many my clients have had trouble making progress.

Change is a fundamental and unavoidable part of life. Sometimes there is more change and sometimes that change presents much more difficult challenges. During those times, companies need to adapt more quickly and more surely to new realities.”

In a recent series of articles, I tried to define ‘investment grade’. I used the term to mean the characteristics of a company that make it attractive to investors. In part six of the series, I turned my attention to the initial presentation.

I recently posted a discussion focused on the use of investment proceeds. The response was amazing. Lots of extensive and well thought out responses. I wanted to expand that discussion a bit by asking about what I consider to be the most important characteristic that a founding team can have – the ability to implement effectively and consistently.

One of the biggest issues in any discussion with potential investors centers on the use of proceeds. Many entrepreneurs want to use the funds to pay their own salaries. Investors prefer that funds go towards other expenses – particularly those directly connected with revenue generation.