ENT 600 Blog #6

Investing, to be honest I have never looked at business through an investors point of view. I just kind of though that when the time came for me to start my own business, I would prepare a great business plan and if I needed help people (investors) would throw money at me. Naïve, I know. After reading more of Noam Wasserman’s book The Founders Dilemmas I am learning that Investors actually face their own set of problems and as a founder it is not always easy to secure funding from investors. When a start up is created it is from the founders dream and vision. As much as a potential investor wants to be on board to help fund your dream they also are trying to reduce their own personal risk and that comes with the potential for them to press some of their own ideas and direction for the company. This pushes many founders to not reach out to investors. In my opinion it can sometimes be a pride issue. No one likes asking others for money especially if that means they have some kind of control over how you spend the money.

Investor dilemmas can also be one of the scaling issues that come with growing your business. However they can also be a resolution to one of the problems growing business face. That problem being “growth” itself. As startups begin to grow many entrepreneurs fail to grow with their business. The Fortune.com Article Transitioning from a startup to growth-stage company suggest, “to get better as you get bigger.” The age-old saying “If ain’t broke don’t fix it” does not apply here. Reaching out to investors and even forming partnerships with the competition can help push your business forward in times of rapid growth. It may seem impossible to collaborate with the big names when you are just starting out but that is where investors and the right set of board members can come into play. Another issue that plaques entrepreneurs in the growth stage is focus. When your initial business becomes successful you start to look at other ventures and opportunities and take your eye off your core business. I personally, foresee this as being a problem for me. When I think about my vision for a start up, I often began thinking 10 steps ahead at what other businesses I can tie in. This takes my focus off my original idea and does not give it the full attention it deserves to be really developed. I can see how this is problematic. In my current 9-5 I find myself multitasking amidst my projects which is effective in most cases but if not done correctly it leaves a lot of unfinished work and some projects suffer because they were not given the attention early on to sustain their value. It was interesting to read of the of the many issues growing companies face in their growth stage. I expected finances to be top on the list but many of the problems relate back to core values and in some cases good old common sense.

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