What are the top things founders and investors can do to cultivate much better founder/investor relations? originally appeared on Quora: the place to gain and share knowledge, empowering people to learn from others and better understand the world.
What are the top things founders and investors can do to cultivate much better founder/investor relations?
There is a very similarly worded question , focusing on what founders can do to foster a healthy relationship with investors. This question is subtly different because the focus is on what founders and investors can do to cultivate much better founder/investor relations? Indeed, investment relationships are a two-way street. So what can both founders and investors do?
- Be self-aware. Knowing what your strengths are, what presses your buttons, how you react to and deal with stressful situations, your propensity for risk, what gets you excited... the list goes on. Being self-aware or improving your self-awareness helps you identity your fit in a relationship.
- Develop conflict management skills. I couldn't decide which to list first - be a good negotiator or be a good conflict manager. I decided a precursor to good negotiating is knowing how to manage conflict. This is one of the biggest issues in investment relationships and it is also related to knowing how to disagree well.
- Develop your negotiation skills. This involves founders and investors carefully listening to each other and looking for points of collaboration with each other not adversarial competition.
- Spend time to get to know each other as people. Lots of folks probably disagree with this. I've met a lot of people who prefer to separate business from other aspects of their life. But quite frankly, even in business and investment relationships, bringing the human factor into the relationships makes it far more enjoyable. All of my business and investment relationships have stood the test of time and endured because we liked each other as people. Trust and loyalty develops when you get to know the whole person you're working with.
- Celebrate together. I host an annual event for existing and some prospective investors in our fund together with our portfolio company founders. We celebrate, eat, drink, and be merry. I've been the guest of one of our founders at an awards dinner, where she was an award nominee. I've attended investor and community appreciation parties hosted by our founders. We celebrate the successes and remind each other we're in this together.
- Go through hard times together. I have to tell you, here's how not to do it: don't bail. I've had founders bolt when the going got tough. Our bad for trusting our intuition (and there were signs!) and letting things go as far as that. Bad times happen and they are great opportunities to work hard and get to know how the other really thinks and works. Get through a hard time together and you know your relationship is solid.
- All of the above contribute to being able to communicate openly and honestly with each other.
The relationships I have with the founders we've invested in are wonderful - the best part about being an investor and entrepreneur.
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