…and then getting hit by an airplane!
A fellow entrepreneur was explaining why I hadn’t seen him for a few weeks. He had been on the verge of closing a decent funding round (his second) to see him through the next 12 months of business growth, when his lead investor inexplicably pulled out at the last minute. This left his plans wobbling, bank account thirsty and him running around London trying to find a replacement investor.
To borrow a metaphor about adulthood; ‘starting a business is like looking both ways before you cross the street, then getting hit by an airplane’. So often; funding promises are broken, enthusiastic sales prospects stop answering their phones and business partners turn out not to be as enthusiastic as they seemed. It’s a frustrating fact of business life that people often do not do, what they say they will do.
In my experience, one of the biggest causes of all of this is many people’s adversity to saying no. Often, an entrepreneur is the most positive person a prospective client will meet all week. Enthusiasm is infectious and many people (even some rational investors) hate saying no to exciting sounding ideas. This has its downsides, of course, because chasing around prospects for six months after perceived enthusiasm, is incredibly time-consuming and quite often a fruitless exercise for the entrepreneur. Of course, others love you and your idea; the idea is exciting and you are its greatest evangelist.
Entrepreneurs need to be tougher in their approaches to prospects, whether they are for investment, partnership, employment or custom. Tougher doesn’t mean nasty, it just means getting to no – and hopefully the odd yes – faster. Early on in any conversation, you need to understand whether; (1) The person you are talking to can make the decision you want, (2) They have the resources you need and (3) Something might get in their way of buying what you have. If you can do this really early on, you can save a lot of time and hopefully dodge a few more airplanes.
Early on in my career I worked in a Jaguar car dealership and I remember a prospect walking through the door, pointing at a shiny new red Jaguar Sovereign and asking how much it was;
“£44,000.” I replied.
“£44,000? That’s £4,000 more than [Garage X] down the road.” He responded.
“So why not buy one from them?” I enquired.
“They haven’t got one.”
“Well, when we haven’t got any, ours are also £40,000.”
Don’t be hoodwinked, always ask why a prospect is interested; let them tell their own story about why what you have and why it would be great for them. Be humble but firm and state clearly what you need from them. You can’t dodge all of the time-wasters but, by being a little tougher, you can minimise the impact.
If they can’t make you feel completely comfortable that they will deliver, move on. There are plenty more roads to cross and you might just avoid a few planes.