I’m not an investor, although I have put some money into a few friend’s businesses. What I try to be instead is a helper — an advisor with no strings attached.
If someone wants to give me some equity I may take it, but I don’t ask for it and I generally don’t want it.
If someone asks me to help, and I like them, and I think I can help them, then that’s what I’ll do. Getting anything in return turns it into a deal and an obligation. I don’t want deals or obligations— I just want to help.
If I’m considering helping a new entrepreneur I’ll often ask them if they’ve ever worked retail. In a shoe store, a grocery store, a clothing shop, front of the house in a restaurant, etc. I want to know if they’ve had to work with the public. Sell to the public. Improvise with the public on the spot.
I want to know if they’ve ever had to make someone a customer. Or watched one walk away.
No retail experience doesn’t disqualify them, but it’s a bit of a red flag for me. I like people who’ve had to sell before. I like people who’ve worked retail. There’s no better lesson in business than the experience of dealing with the public in person.
If you think presenting to an investor is hard, try convincing a 70 year old to switch shoe brands or buy a different kind of peanut butter. Or trying to explain the subtle difference between two tennis rackets to a mother who has a 2 year old melting down at her feet and tugging aggressively on her purse. Or trying to explain why your shirts are worth $10 more than the exact same ones online.
A few months ago I met a guy who was running a pop-up tea shop here in Chicago. I’m a tea guy so I dropped in to check the place out. We had a great conversation — I think I spent a couple hours there. We kept in touch.
Recently we caught up again to talk tea and business. He’s going all-in — opening up his own tea shop here in town. Not too far from where I live, thankfully. I’ll be a happy customer.
He asked me if I’d get involved. I told him I’d help. I liked him, I think he’s got a good idea, and it’s a business I’d like to see open up. He’s got something. Very tough business, it’s going to be very hard to make the economics work — and he knows that — but he’s the guy to try.
But what really impressed me was the way he was planning on using his time over the next few months before his place was ready to open. He was planning on getting part time jobs at local tea and coffee spots to sharpen his feel for how customers buy these products. Not how the shops work, but how the customers work. How the public behaves.
I like that. A guy who’s going to get a part time job as research to start a business. Part of building his business is to go to work for someone else.
I’ve met a boatload of entrepreneurs, and I can tell you many of them would see that as beneath them. Part time jobs, or working for someone else, were things they used to do. Why do that again?
I see it differently. I see humility. I see a student. I see someone devoted to learning, observing patterns, honing his senses, and sharpening his mind until it’s go time. It’s a great way for him to spend his time.
He’s the kind of guy I like to help.