Share0
Tweet0
Share0
Share0
Tweet0
Share0

How do you handle investor pressure?

We have an investor that is constantly giving us ideas and suggestions. At first, we were pursing the ideas to both appease him and give new things a shot, even though many of the ideas weren’t great.

It has become a distraction and often is just a time suck. As of late, I’ve been either saying, “we’ll discuss it” or simply saying we don’t have time.

I feel like he’s going to eventually get fed up that we’re not taking any of his suggestions. 

How have others handled a situation like this?

  • I’ve read somewhere that the founders who ask their investors for advice the least tend to succeed the most. No investors can know how to run your business better than you, since they’re not working alongside you every day, so there’s no way that they could have some great insight into your business that you haven’t figured out already, and if they do then that means you’re not a very good entrepreneur.

    I would just ignore him. He’s one of those investors that secretly wants to be an entrepreneur, which is why he’s feeding you so many ideas; he looks at the company as his baby.

    Reply

  • Generally this type of investor feels that the strategy is loose and the meetings to discuss his thoughts are loose… so he can keep throwing them in willy nilly.

    I would set up a once a month meeting with the investor to cover the core plan and its execution and listen to their advice with the pertinent team members on hand (and discuss whether or not those ideas work and most importantly the ideas relevancy to the plan and or its execution). You will hear the suggestions and he will come to understand that your team has an execution focus and will stop feeling the need to constantly throw in advice. You both benefit.

    Reply

  • I’ve also had overly entrepreneurial investors in the past. Just like you being a first time entrepreneur I had paid a lot of attention to my investors ideas. Knowing that they had success and experience in their own businesses. In the end I ended up wasting a lot of time by ignoring my gut feeling to just say no.

    Honestly, it is always good to get advice (from almost anyone) and one should be respectful of their investors time and money devoted to one’s business. With that said, I’ve learnt to discuss investor advice in regards to my product and customers. As the entrepreneur you will be the one spending the most time on your business and customers. You have been building up a domain knowledge that your investors will unlikely have been matching. So better listen to the actions of your customers. They should speak louder than your investors ideas. At the same time your investors will have their own agenda, if they say you are thinking too small then it is perhaps them talking to themselves, however it may not apply to your situation in that moment.

    As has been said by the previous commenter, build a formal process where you can discuss once a month the strategy. Listen to their ideas. But be prepared to say no. In the end you are running this business and in order for you to be able to run this business you need to have the ability to execute.

    Reply

  • In an earlier company, we had a few angels who just would not keep their noses out. It got to the point where they tried to “tell” us what we should be doing rather than suggesting it.

    We had to gently remind them of the difference between a shareholder, a member of the board and an employee of the company. Once we established some boundaries it was fine, they backed off and switched to offering advice and being available when needed.

    Reply
    • {"email":"Email address invalid","url":"Website address invalid","required":"Required field missing"}

    You may also like

    >