People
- The entrepreneur (or founding team) needs to be smarter than me and possess an unrelenting passion to solve the problem which they are exposing.
- The company should be conscious of, but not be motivated by, their revenue model.
- I should feel like a personal asset to the company. I don’t just want to be a bank, but rather an engaged adviser, mentor, and customer to the company.
Positioning
- The timing must be right. The market has to want or need the thing that is being built.
- Is the product, idea, or concept protected from competitors? What is proprietary about this? What are the differentiators?
- The total valuation can not be inflated based on false assumptions.
- It has to be a company that I scream “hell yes” for. If I’m not completely passionate about what they’re doing, there is probably something better out there for me.
Purpose
- The marketing plan isn’t enough. Tell me more about the why. There must be a belief, or something to prove to the world. There should be an endless mission being pursued. There needs to be a story much greater than the product itself. Plan to share these things with the world.
- I’d like to understand the exit strategy well in advance. There doesn’t always have to be a planned sell-off, but if we’re building something long-term, I’d like to see how valuations can be multiplied over a realistic time horizon.
- The company should already possess liquid assets. I’m always trying to protect myself from massive losses upon complete failure.
