What To Do When You Lose an Investor
Photo by Travis Essinger on Unsplash
Hey Founder,
Course correcting after a setback takes a clear head free of drama. Here’s how to get there fast.
In the entrepreneurial journey, twists and turns are par for the course. One such curveball comes when an investor, previously committed, suddenly retracts support for you. It's a scenario that can unnerve any founder, leaving them teetering on the edge of uncertainty.
If you are facing just this dilemma, I have some advice you that centers on regaining control over what you can influence, enabling you to respond constructively. Here's the roadmap I offer:
1. Acknowledge Your Position: Accept the emotional maelstrom you're in. Anger, disappointment, frustration, and fear are all valid. Embrace them, for denying these feelings only prolongs the process.
2. Move, Energize, Elevate: Get your body in motion. Whether it's a gym session, a surf adventure, a run, or quality time with family, do what rejuvenates you. Physical activity has a remarkable way of clearing mental clutter.
3. Go Third-Person Perspective: Temporarily shed your CEO identity. Approach the funding hiccup as an impartial observer. Analyze your financial landscape objectively – cash flow, operations, growth, overhead. This exercise isn't about your ideal self; it's about the real state of affairs.
4. Know Thy Customer, Know Thy Market: Now, shift focus to your clientele. Scrutinize customer satisfaction and pipeline metrics. Dive deep into unit sales growth and glean insights about current and potential customers. Understand your market dynamics inside out.
5. Revisit Your Vision and Purpose: Reconnect with your company's raison d'être. Define the pivotal action aligned with your purpose. Identify where to channel your existing resources and where new infusion, like investor funding, should be directed.
6. Document Your Playbook: In this exercise, you've crafted a document - a playbook. This is your tool to present to your investor. While the outcome isn't certain, the effort speaks volumes. It showcases your potential, and that alone is invaluable.
7. From Victim to Victor: This shift is pivotal. You've moved from a stance of victimhood, where things happened to you, to proactive problem-solving. It's a stride towards the next phase of your venture.
Remember, acknowledging and moving beyond the emotional fray isn't just about saving face. It's a strategy that resonates with investors. It portrays you as a leader who navigates storms with composure. After all, as the founder leads, so goes the company.
Please let me know what I can do to help you stay above the line and feel the power until the next tranche arrives.
Sincerely,
Rob Craven, scalepassion
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All credit to my ghostwriting partner, Dave Moore, who is instrumental in getting my thoughts out in a coherent manner & into these blogs. Thanks Dave!