Lately I have spent a lot of time talking to venture capital firms about making an investment in ShopSavvy. Several weeks ago I sat down at lunch with one firm and they asked me what it would take to get a deal done. I think they might have been asking me what sort of pre-money valuation I was looking for, but instead I suggested that I was looking for a firm that was as excited and passionate about my business as I am. I recognize that this excitement/passion standard might be somewhat unreasonable, but at the end of the day it is true.
We got together two weeks later at their offices to meet some of the other partners. Afterward they asked how my conversations with other potential investors/buyers were progressing. I explained that I was letting these other conversations run their course, but I wasn’t in a hurry to do anything. They explained that they would be taking their time as well, but they did want me to let them know if something changed so they could ‘hurry up and engage’. This comment got me thinking, ‘Maybe they aren’t as excited/passionate as I am’.
So many times entrepreneurs (like me) chase investors who aren’t really that passionate about our businesses. I want passion, excitement! I want an investor who is excited enough about my business to fund it regardless of what other investors think. I want an investor who is passionate enough to get a deal done even when no one else is forcing their hand. Am I asking for too much? Perhaps, but the venture capital world is changing – money isn’t necessarily the currency of the realm anymore. More and more startups are VERY capital efficient; however, there has been no such increase in passion-efficiency.