Early stage investing is as much about people and relationships, if not more so, than it is about metrics, product and market size. Investors and entrepreneurs need to build a rapport and that responsibility rests on both sides. Call me old fashioned, but etiquette and manners matter. This is a diminishing artform anyway given that we are often immersed in our smart phones, cut off from the world with our noise cancelling earphones and generally moving at lightspeed to cram everything into our ever more busy lives. But that is never an excuse for poor behaviour – ever.
The reason it matters is more than just personal sensibilities is that this behaviour and approach is a proxy for how you conduct yourself with customers and future hires which in turn speaks to how you will build a business.
I won’t go into detail on the obvious here such as being polite to staff when visiting offices. If you cannot get that right, then there is little hope. Instead, I am going to spend the next two posts talking about introductions – something investors are often regularly involved in. In a business context, it is important to use the “double opt-in” approach when making introductions. Many people do not do this. The double opt-in approach, for those that do not know it, involves getting both people to agree to an introduction before the connection is made. There are several reasons why this is a valuable approach:
- You don’t put anyone on the spot. People often talk about a VC’s “network”. This network is fragile though and requires nurturing, attention, reciprocity and care. Putting someone on the spot undermines this.
- An affirmative action is required to take the meeting or introduction, the conversion rate is much much higher. Linked to the point above, this delivers more value overall and therefore strengthens the network effect.
An introduction is a reflection on the introducer as much as it is on whoever is asking for the connection. It should come as no surprise to learn that people will not follow through if they feel it reflects poorly on them to do so. So be specific with your request and why you feel this connection would be valuable. It will be easier for the person on the other end to know how they might help, and if they feel they can help, they are much more likely to try.