Enthusiasm the key to business success 
Liam Horan
TWO weeks ago, in relation to the whole business angel/investor concept, I asked you to think about the single most important factor in the eyes of the investor? What one thing about the start-up business, and its people, mattered more than anything else?
Enthusiasm, that’s what.
That’s what a major American study of business angels has shown. Top of the list there is ‘enthusiasm of the entrepreneur(s).’
A fortnight ago, as it happens, I interviewed both Brian Cody and Mickey Harte for The Irish Examiner newspaper, both of whom know a thing or two about generating success. I asked them the same questions, including this one:
“Rate the following attributes in a player in order of importance: skill, intelligence, strength, mobility, and enthusiasm?”
Both put enthusiasm at the top. “If you’ve enthusiasm, there’s no end to you,” said Cody. “Enthusiasm is the best attribute anybody can have,” said Harte.
To take the experience of the Dragon’s Den, how often did we someone come through the door with the germ of a good idea, only to get blown off the back wall because the Dragons sensed a lack of commitment, an absence of enthusiasm?
Here’s a direct quote from the findings of the study on Tech Coast Angels in the USA:
“Angels seemed particularly impressed in whether the entrepreneur was passionate and committed to do whatever it takes to work through all of the problems of a start-up to succeed.
“Angels found entrepreneurs with passion and commitment more engaging and interesting. One entrepreneur that embodied this kind of passion was a financial services start-up that provided prepaid credit cards.
“While the entrepreneur did not have any actual financial services experience, he showed high-energy enthusiasm that impressed the angels. In addition, he had made reasonably money in past careers and had put most of his money, including mortgaging his house, to start the company.
“The passion and perceived commitment of this financial services entrepreneur garnered excitement from the investors.”
Makes sense, really. We all like to feel the heat of passion when it comes to discussing a business idea.
Almost anyone can be coached to get up and give a pitch. They can be competent, professional, impressive even. But those are not what stimulate people: stimulus comes from a sense of energy, excitement, belief, the permanent possibility of something incredible about to happen, the tingle along the spine, the ever-present hope that this could be The One.
The Tech Angels Study again: “If the entrepreneur lacked passion or enthusiasm, investors appeared to be less interested. This may be due to the perception that start-up success is so difficult that entrepreneurs without great commitment and enthusiasm might be less likely to succeed.”
You may be curious about some other attributes that ranked in the top ten in the study: trustworthiness, persistence, openness to mentoring, track record, how complementary the skills of the team are, the experience of the advisors, and how much experience the team has of working together.
Another issue for investors was the exit strategy. “Angels primarily invest to receive a return for their money. Since angel investments usually have a 4-6 year horizon, and return is typically only attained through an exit or liquidity event, angels seek ventures that will grow and be attractive to acquirers or have the possibility of an initial public offering (IPO).
“Since IPOs are rare, angels are very interested in learning who the potential acquirers may be before a particular venture. While observing entrepreneurial presentations at TCA, it was not uncommon to observe a start-up that had already demonstrated profitability, had a solid business plan, and was led by an entrepreneur with a proven track record but did not garner much interest due to an unclear exit path.”
Registration at the Halo Business Partnership here in the west of Ireland costs €121.50 (incl. VAT), and can be done by contacting Gerry Mackey (bmw@businessangels.ie), telephone 091 730 850.
Liam Horan is the proprietor of Sli Nua Training, which runs affordable three-hour training courses aimed at the small-medium sector. They have upcoming events in Castlebar, Galway and Athlone. More on www.slinuatraining.com.
De Facto with Liamy McNally appears in our election supplement.
