I spent last week as a panelist at the Hirshberg Entrepreneurship Institute, which was great fun and a huge honor.. Being around so many amazing brands and their founders energized me and made me think of this article that I wrote last year. I’d love to hear your thoughts.
The other day I was sharing an Uber with friends who also happen to be managing partners of a food and beverage VC fund. Being nerds of the business, we quickly moved the conversation away from the Trump-Putin press conference to noodling the question, “What traits do we want to see in investment-ready founders?” The ride ended soon after, but the question lingered. Although not exhaustive, the following are what I believe to be the key traits.
A deep visceral passion for the brand, product, and mission is vital. I am looking for founders whose passion is like that of a street corner preacher. It is so deep-seated that they feel compelled to climb up on a soapbox with fire and brimstone and tell all what it is that makes their brand, product, and mission special. Passion will also see founders through those dark and stormy nights. This is so hard, I could not imagine doing it without passion as my constant companion.
Wrong and right
I don’t know how best to describe this trait. There is a balance between a willingness to be wrong and the need to be right. I think of it as a continuum. Founders need to be willing to accept criticism, be shown a better way or a different approach. But, at the same time, they can’t be so malleable that they are like Gumby. They must, at times, display the moxie to lean into what they believe and not back down. Advisors, consultants, and stakeholders don’t know everything, even though we talk as if we do.
This is closely related to the above. When it comes to a food and beverage startup, healthy conflict is important. We tend to tether our ideas to self. Founders need to be able to cut that tether and allow ideas to be debated, torn apart, and rebuilt. That’s how good ideas become great and how you stop bad ideas from becoming expensive mistakes.
Know what you don’t know
A form of humility, this is so critical to success. The food and beverage business is so damn complex. No founding team has all the knowledge and skills needed to scale a business. Smart founders see the gaps and leverage other team members, outside service providers, and advisors to round out the available skills to make sure the needed wisdom and knowledge is accessible.
Although in my opinion, this is obvious, it is surprisingly not as common as it should be. As mentioned above, this business is hard. Founders are going to make mistakes, numbers aren’t always going to look good and not everyone is on that hockey stick growth trajectory. Strong leaders own their mistakes and don’t obfuscate them. They see them as lessons, teachable moments. Mistakes and challenges are what build a better strategy. Investors will see right through the charade if an attempt is made to sugarcoat results.
Founders must be able to laugh at the absurdity of this journey. They have the ability to laugh at themselves and with each other. They’re off-roading it while most take the safe paved route. So, they make sure to enjoy all the bumps, twists, and turns and try not to take it so seriously.
The above represents what I believe to be the most critical traits and are the ones I look for in the founding teams I work to support. Certainly, there are others, but I’d argue that those listed above are the most vital. I’d welcome your thoughts.