September 7, 2014
The major players – entrepreneurs and investors – in the startup world lead completely different lives, but they need each other for the ecosystem to survive. On the most basic level, entrepreneurs are always wondering, how can I get an investor to fund my company? And investors are always wondering why should I fund this particular company, when I see hundreds of pitches per month?
But what about the people who live in both worlds? Those who have millions of dollars to invest, but have also had to hustle, recruit team members and pitch? It’s a unique case, but Shahzil Amin offers an interesting perspective on what investors are looking for. He’s the Founder and CEO of Blue Track Media (successfully exited), the Founder and COO of Plugged Inc., and now recently a Managing Partner for Karlani Capital.
“It’s been one of the best learning experiences I’ve ever had,” says Amin. “People my age are looking to get their MBA’s right now, but my real life day to day experiences have been more valuable to me than any degree.”
There are a few challenges that come with being both an entrepreneur and investor.
“Even though I’ve crossed over to the ‘dark side’ of investing, I always have an entrepreneur mindset first. There are not many investors out there who are still entrepreneurs,” says Amin. “I constantly hear pitches and I think in my head, ‘this is how I would approach running this company and the obstacles they face’, but I forget that I’m not the CEO. I have to remove myself from the equation and judge whether or not I trust the entrepreneur to run his company successfully.”
Amin knows who’s “faking it” and who’s for real. Here are a few his tips:
- Don’t be a “Want-trepreneur:” Amin says don’t believe the hype about entrepreneurship; it’s not as easy as getting on TV and making it big. “Because of what people see on Shark Tank, they think that a company can get so much traction and national media attention without having an execution plan in place. I’m not a fan of people who want to be entrepreneurs. I’m a fan of people who need to be entrepreneurs due to circumstances or passion,” says Amin.
- Get Ready for a New Learning Curve: When Amin and his partners started Plugged Inc., they had to be open to learning new things that weren’t talked about in the initial market research. “My first company, Blue Track Media, is in the ad-tech space so the jump to retail and manufacturing was quite a shift,” says Amin, “but at some point you have to realize that research can only teach you so much. If you’re passionate about your idea then stop researching and dive right in, in order to learn through the journey.”
- Preparation is Everything: You’re probably familiar with the saying, “It’s better to be prepared and not have an opportunity, than to have an opportunity and not be prepared.” The biggest mistake Amin sees is when entrepreneurs are under-prepared: “Prepare yourself for whatever curve-ball life throws your way. Understand your market, your competitors, your industry, your customers, everything so that you’re always ready to hit a home run.” says Amin. “It’s as simple as me walking around with a pair of my headphones in my backpack because every day I meet someone random that is interested in what we’re doing at Plugged Inc. That’s preparation.”
- It’s not just about your idea: Amin says investors look at the founding team as well. He says he can have a 20-30 minute conversation with someone and know if he’ll invest in them: “Brilliant ideas often fall short because of the person behind the idea,” says Amin. “I like to invest in people like myself. People who are passionate, hustlers and are able to ‘get the job done’ under any circumstance.”
- Know Your Investors Before You Need Them: Everyone knows that you’re practically married to the people who invest in you. “Take funding from investors that you’re able to trust and that share the same passion for your idea that you do,” says Amin. “The only way to judge that is if you have built a prior relationship with them before the question of funding comes into play.”
- Acquire Knowledge: Amin says he has a thirst for knowledge. He spends about 60% of his time reading anything from recent tech news to articles about space and time. He continues to learn and has even audited different courses at universities such as Columbia University. “During college I never went to class because I never paid attention, however, now I take classes I’m actually interested in at renowned universities. And best of all, it’s free.”
These are just a few of his tips for founders as they develop their ideas, business foundation, and start down the road to funding.
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