Entrepreneurs Aren’t Supplicants; Investors Aren’t Gods

I try, very hard most days, not to get my ass on my shoulders when faced with the arrogance that is too much a part of the culture of Silicon Valley.  Many entrepreneurs and investors have earned the right to puff up their feathers and parade their success in front of those who have not yet achieved their greatness.  Too many others mistake being lucky for being good.  It’s just a part of life in this plot of land we call home.

But just now, I couldn’t help myself.  You see, I’ve been working a diligent, intelligent, thoughtful guy who is taking on significant risk to his core business and family to bring an incredible (non-technology) product to market.  Having already built a successful alternative medicine practice, Ted Ray is commercializing his FlyRight anti-jet lag formlua.  The  product is amazingly affective and may well be the only reason I can log the air miles that I do without biting off the heads of small children.  In a few short months, Ted’s made tremendous progress with the business.  He’s developed sharp point-of-sale packaging, cut deals with several duty-free and travel retailers, and he’s even managed to get a product placement at a major celebrity event this Fall.

Now, he’s looking to raise a modest bit of capital, an endeavor new to him as it is to every first-time entrepreneur.  And, like every first-time fundraiser, he’s absorbed the rebuffs and jumped through the hoops of investors.  He is diligent and thoughtful in his follow up.  He is gently persistent.  He struggles to remain optimistic as he puts more of his own money into a business about which he passionately believes.

In the Spring, through an introduction I made, Ted exchanged e-mails and had a long phone conversation with an “angel” investor who invited Ted to re-connect after he’d navigated the maze of demands, objections, and “advice” the investor put before him.  In the intervening months, Ted focused on product distribution, scored a major marketing win, and signed on to a trial  with one of the largest travel retail outlets in the world.  Oh, and he rewrote his executive summary to the one-page format the “angel” demanded.  Then today, Ted accepted the offer to be back in touch and sent a polite message to the “angel.”  The “angel’s” response was nothing short of rude, self-important, and arrogant.  Lacking any sense of memory of the previous conversation, this “angel” responded with the neigh of a jackass.

It’s not the first time I’ve witnessed this sort of behavior.  Too many investors expect entrepreneurs to step and fetch, only to drag out a deal to which they are afraid to say “no.”  Maybe they come by that attitude honestly enough. When entrepreneurs behave as supplicants with begging bowl in hand, rather as than business people selling a piece of their company and the vision of what it can become, how could investors not become prideful of their role in the ecosystem?

But let’s not forget that without the entrepreneur, the investor doesn’t have much of a roll to play at all.  And it’s a small enough Valley that bad behavior doesn’t go unnotieced.  Suffice to say, this “angel” is off my referral list.



  1. jim Forbes said

    Bad behavior not only goes unnoticed, Chris, it becomes “the norm” and is rewarded by sycophants who adopt it–thinking they can get away with it too!

    What I believe to be really treagic is that entrepreneurs cowtow too easily and don’t walk out of meetings by telling the investor to politely “have intercourse with themselves.”
    It’s a sad statement that too many investors are little more than dickensonian clerics sans sleeve garters and eye shades. There was a time when investors were people who had developed products. Today, they are more likely to be people with the “proper pedigree.”

    Cowtowing leads to massive subservience, which isn’t good for termsheets or start-ups. Arrogance leads to failure.

    Good post, Chris. I wish you would have named the investor. Assign blame where it’s due and reward competence.


  2. Excellent post, Chris. You always tell it like it is.

    You should write a post about board members. Who inject themselves into the business inappropriately, who make suggestions based on their past experience without an intimate understanding what’s going on at the company, and who arrogantly shoot off e-mails to execs demanding features. There’s nothing I hate more than adding a feature to the product because a board member requested it. Board members should be present to make sure that the management team is on track, to deal with large strategic issues, to be trusted advisors, and to deal with investments. They should not be involved in day-to-day operations, unless they’re asked to do so.

    I’m not bitter =)

  3. bycyclist said

    “Too many others mistake being lucky for being good”

    Thats a quotable quote.

    Also, life’s to short to have to deal with the whole “Masters of the Universe” attitude. Even for entreprenuers desperate for capital.

    After all, is that really the type of attitude you want on your board?

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