There’s a rumor going around that investors write checks only based on the likelihood of making money. While making a good return is a high priority, there’s an equally high priority of enjoying the ride, and that comes down to personality fit. That’s right, investors are gauging how much they like the entrepreneurs as well as ability to generate a return.
In addition to personality fit, here are some entrepreneurial characteristics investors look for:
- Leadership – Startups require great people and great people require strong leadership
- Perseverance – Startups are hard, very hard, and everything takes twice as long as expected
- Confidence – With so many unknowns, it’s important to have visible belief in the direction and approach
- Work Ethic – Startup often require long hours and it takes a few years to develop a work / life harmony
Another way to describe it is that the entrepreneur has to pass the canoe test: would you enjoy spending a day with the person in a two person canoe on an open lake?
Never forget that personality fit is as important as making a great return.
What else? What are your thoughts on the importance of personality fit for investors?