Recently, Entrepreneur posted an interview with Paul Graham that I found really interesting, so I wanted to share. Graham is the co-founder of Y Combinator, a seed-stage venture firm that has provided funding to 40 start-ups including some that you may have heard of like Loopt and Reddit.
You might not have the idea for the next Twitter, but your blog is a start-up too, if you treat it like a business rather than a hobby. You can look for investors in a traditional sense, but this interview is also good if you’re looking for people willing to spend money on your site in other ways (like people who might advertise on your sidebar or as a slot on your podcast).
According to Graham, what’s the number one thing he looks for when people come to him with investment ideas?
Determination. When we started, we thought we were looking for smart people, but it turned out that intelligence was not as important as we expected. If you imagine someone with 100 percent determination and 100 percent intelligence, you can discard a lot of intelligence before they stop succeeding. But if you start discarding determination, you very quickly get an ineffectual and perpetual grad student.
It makes sense – you want to know what someone isn’t going to give up (and lose your money), just because running a business (blog or otherwise) is difficult.
If you’re hoping to approach some investors, here are a few ways you can show your determination:
- Blog consistently. If you’re a sporadic poster, the investor might thing that you’re a sporadic business owner in general. You don’t have to blog every day, but be consistent.
- Have a business plan. If you’re determined to make something work, you’ll have a plan going into things – and investors know that. Without a solid plan, you come off as “well, we’ll just see what works, and if it doesn’t, make money, we’ll just quit.”
- Be prepared to talk about your past successes – and failures. It’s okay if you were involved in projects that didn’t work in the past, as long as you’ve learned from the situation. Talk about what you’ve done that has worked and what you’ve done that hasn’t worked in relation to how your project today is different.
If you get a “no thanks” answer, don’t get discouraged. It doesn’t mean that the answer will be no from everyone, nor does it mean that the answer will be no forever. Part of showing how determined you are is continuing to develop the project and then re-approaching the investor in the future when you’re a little farther along and can better address some of the concerns they had. Don’t be afraid to keep in touch with potential investors who’ve been hesitant to give you money in the past.
Check out the full interview on the Entrepreneur website.
Image by Dana Lookadoo – Yo! Yo! SEO