One of the strengths of an entrepreneur is that they must do everything. They’re a sales executive one day, then they’re diving into marketing, development opportunities, and finance, but it’s their ability to be multi-function that sets them apart. All early-stage founders are generalists.
But this strength can easily become a weakness if a founder relies on it for everything.
Eventually, they hit a growth ceiling which, for all intents and purposes, is the limits of time and knowledge. Simply put, they can’t scale past the number of hours in a day.
Knowing when to ask for help, and the ability to effectively delegate is a sign of maturity. The clients and prospective clients who I’ve engaged with while at WGP are mostly mature, globally minded, well developed people who recognise their own efforts need to be spent on growing the business.
As a consequence, they’re pleased to be able to rely on WGP in order to shorten the time it takes to get them in front of a qualified investor.
The more open a CEO is to the delegation and breaking through that ceiling, perhaps because they’ve encountered it before, is the key to growth.
I’ve tried to DIY myself and went through all of the cycles that I now see my prospective clients going through. From asking for too little money to think you can do it yourself.
You can of course, and that’s celebrated in the ‘venture capital vortex’ whereby you can download a pitch deck template off of the internet and send it off to all the VCs you can find.
This “Venture Capital Vortex” is how VCs essentially drive their cost of acquisition to zero! All kinds of deals flow with little effort. Imagine if your startup got as many leads, for free, as the deal flow of a well known VC.
It’s in the VCs interest to celebrate the solo success of the DIY approach, but I’ve come to realise engaging someone with existing contacts to capital saves time and money.
A Canadian entrepreneur I follow is Dan Martel. He taught me that: “Investors don’t want to hear from you, they want to be introduced to you,” which implies a relationship of trust.
Entrepreneurs get about 30 seconds in the first minute of conversation to try and carve out a meeting, and then will only have 15 mins of headspace with a funder or investor in order to get them interested. That’s amazingly small odds when you actually do the math.
Think about the time that it takes and the cost that it involves. Some CEO’s have said that their full-time job when starting out is raising money, but there are some tasks where we can trade money for time.
Raising capital might be one of them.