10 Things an Investor Looks for in an Entrepreneur

By Fran Hauser

One of  the key activities when you start a business will no doubt be raising some kind of investment. Getting a meeting with an investor to pitch your idea is a critical step for any entrepreneur and an opportunity you definitely don’t want to blow.

As an executive, angel investor, and venture capitalist, I’ve seen hundreds of entrepreneurs pitch their businesses—but I’ve only funded less than 5 percent of them. What makes one entrepreneur stand out and capture my attention? There are distinct characteristics (10, specifically) that I look for in a founder. And while every investor is different, this list of qualities should provide valuable insight as you prepare your pitch.

1. Vision

It may sound obvious, but the first thing I want to know is whether the founder has a clear sense of where she’s going, what market her company serves, and how she will grow into the future. This is your starting point and something that should come through clearly when you present your business.

2. Conviction

If a founder doesn’t believe in what she’s doing, why should I? That said, rare is the startup that hasn’t had to pivot or that hasn’t benefited from the insights of an advisor. I want to know that you have a clear True North and that you’ll stick to your guns when it really matters, but also that you can be open to insights your investors, advisors, and customers may provide.

3. Curiosity

No one knows everything and the one constant I know we can count on as business people is change. Founders who demonstrate a curiosity about the world, about their customers and partners, and about what is happening next tend to be most successful.

4. Founder/Market Fit

You’ll often hear investors mention this catch phrase, but what does it really mean? Basically, I’m looking at the sum total of a founder’s life experiences to understand what brought them to this point and qualifies them for this role. Sure having an MBA or having worked in a blue chip company may be one of your credentials, but does it really qualify you as the founder of your startup? I ask questions like: Who is this person? What are their professional experiences and their life experiences that inform the way they do this job or understand this product or market?

5. Balance of Humility and Confidence

Nobody likes a blowhard. Remember, the investors you pitch are people you’re hoping to work with over the long-term; they have to want to work with you. That said, don’t make the opposite mistake of being overly obsequious or subservient. I need to see you as a competent, capable leader. Check out Amy Cuddy’s Ted Talk or this piece in the Atlantic for more insights on women and confidence.

6. Delivers on Commitments

If I meet you at an event and you say you’ll send me your pitch, I notice whether you send it in a timely fashion. If you say you’ll get back to me with an answer to a question, I’m waiting for a response. If you offer to make intros, follow through. Don’t make promises you can’t fulfill, because with every interaction an investor is getting to know you. If you can’t deliver on the little things, why should I believe that you’ll deliver the product—and profits—you’ve promised?

7. Relational Intelligence

This is a big one for me. I’m looking for people who can read a room, who can learn from their environment and experiences, and who can adapt to the social nuances of a situation. To me relational intelligence gives me a sense that you will be able to grow, learn, adapt, manage a team and manage customers.

8. Passion and Relentlessness

There are plenty of good ideas out there, but I’m looking for founders who are truly passionate about what they are doing, people who are relentless in their drive or purpose. Soraya Darabi and Maxine Bedat of Zady are mission-driven founders with a burning passion to change the world. When you talk to them you just know how much their business means—not just for themselves as founders but for their vision of the kind of world they want to live in.

9. Industry Experience

Whether it’s professional experience within an industry or deep knowledge of an industry that comes from being a customer or having some other personal experience, you need to really understand an industry before you can credibly tell me that you’re going to disrupt it. Take Jane Poynter who started World View, a company pioneering space exploration for tourism, research, education, and other commercial pursuits. She already had over a decade of experience specializing in life support and thermal control in extreme environments. She spent nine years as part of an eight-person crew living in a sealed biosphere. She’s the right person for this particular startup.

10. High Integrity

If I invest in your business, we’re going to be working together for a long time and integrity is really critical to me. Be honest with me. Be clear on goals, communicate the challenges you face or changes that may occur along the way. And when it comes to negotiations, I get it, we’re all trying to get the best deal we can, but if you go back on your word, or re-open negotiations with me after we’ve agreed to terms, that’s a big red flag for me as an investor.

As you read over this list, you’ll notice that some of the characteristics feel like they are innate and others are about having a specific kind of experience and background. Others are qualities that you may learn and develop over time. If you feel like you come up short in any area, keep learning, keep adapting, and do everything you can to find the advisors, co-founders, and employees who can help fill any gaps you may need to be able to pitch confidently and effectively. And remember, this is my list. Every investor is unique. While you always want to be buttoned-up and put your best foot forward, sometimes a business idea that isn’t right for one investor is just perfect for another.