How to attract investors and raise funds for your business during the pandemic, according to an angel investor

Woman in flower shop talking on the phone
A founder may go through various iterations of their business, but it’s their determination that sets them apart for investors.

  • Active angel investor Heidi Zak says early-stage investors are still making deals during the pandemic.
  • A founder’s business needs to make sense for investors to get on board; dedication is key.
  • Before trying to raise money, show that your business model is profitable and sustainable.
  • See more stories on Insider’s business page.

In addition to being the CEO of ThirdLove, I am an active angel investor – predominantly in consumer-focused women-led startups. As an angel investor, I am always receiving inbound pitches from founders looking to raise their pre-seed, seed, and Series A rounds.

Despite what the pandemic has done to businesses, the economy, and society as a whole, there has been no slowdown in deal flow for early-stage investors. If anything, the general consensus in the entrepreneurship community is that now is a terrific time to start a company – because there are an abundance of problems still to be solved in the world.

That said, just because a lot of entrepreneurs want to start a business doesn’t mean they all receive funding.

As an angel investor and someone who has built and is still running a company that is scaling, there are a few things I look for in every founder and startup I invest in. So if you are starting a business, thinking about starting a business, or already well on your way and looking to raise your next round, here are a few things I encourage you to do to build excitement and successfully raise funding.

1. Make your business easy to understand. Do one thing, and do it extremely well.

Rome wasn’t built in a day. One of the biggest reasons entrepreneurs struggle to raise money is because they can’t decide which one of their ideas is their “core competency” and, as a result, try to build them all.

What this does, however, is make it very difficult for customers, investors, and even employees to get a firm grasp on what it is the business actually does. What’s the goal? What’s the one thing the business will be known for? What’s the problem, what’s the unmet need, and (in a single sentence) what’s the solution? Bam, bam, bam.

If you can’t explain what problem your business solves, how, and why, in a sentence or two, then chances are you aren’t quite sure either. And if you aren’t 100% sure of what problem your business is solving in the world, investors aren’t going to know what they’re investing in.

2. Become close to profitable before trying to raise money

Almost all the investments I’ve made over the past few years have been in companies that were profitable or very close to profitable.

This isn’t true for every angel investor (there are plenty of investors in Silicon Valley who bet on companies knowing they won’t be profitable for many, many years). But since I primarily focus on consumer businesses, I expect the founding team to have already made a bit of money before seeking additional investment. The reason is that, in 2021, it has never been easier to beta test consumer products, gather feedback from customers, and start generating revenue on the Internet.

Once that milestone has been reached, and the team has gathered some data around their unit economics, customer acquisition costs, and so on, the business becomes much more investable – because now, as an investor, I know my money is being used to accelerate something that’s already working.

3. Show you have the energy and dedication to build a meaningful company

At the end of the day, angel investors bet on founders and founding teams.

I have certainly made a few investments that bet much more on the founder than on the business. I call these types of founders “hustlers,” because something about their energy tells you they are willing to do whatever it takes to build a business. They might need to go through a few different iterations to get there, but they are determined to get there.

A few signals I look for:

  • The founders have great energy, and a true passion for what they are building and how they are helping consumers.
  • The founders have some sort of unfair advantage, such as access to other influential people, a large social media following, a unique combination of skill sets, etc.
  • The founders are good listeners, they are curious, and they showcase grit.

That said, at the end of the day, your business needs to make sense for investors to get on board. Very few angels will “take a chance” on someone just because that person is excited about entrepreneurship (and those angels are almost always family members or family friends). The real way to determine whether or not your business is investable is if you share what you’re working on with someone and they immediately say, “I love it. How can I help?”

That’s a sign you’re on to something, and your business is ready to move to the next level.

Read the original article on Business Insider

Use these 3 lessons from the pandemic to build a stronger crisis plan for your business

frustrated man working on laptop computer at home
During a crisis it is important to communicate with your employees first.

  • Business crisis plans are important for unforeseen circumstances such as this pandemic.
  • Being forced to change routines exposed a lack of preparedness in many institutions that needed to pivot.
  • Keeping abreast of new technology and communication techniques can help strengthen future crisis plans.
  • See more stories on Insider’s business page.

When I help a client communicate during a crisis or unforeseen issue, the client will often say something like, “We aren’t sure what to do, because this isn’t in our crisis plan.”

Then came 2020, and virtually all business owners could say that a pandemic wasn’t in the plan. Now we’ve been working, living, and (in some cases) schooling for a year as the COVID-19 pandemic changed everything. While we may never again witness another unprecedented – aren’t we all tired of that word? – global event like this one, this experience can help us prepare for other unforeseen events and issues.

When you write or rewrite your crisis plan for your business, consider adding these three lessons and implementing them before something you hadn’t planned for strikes again.

1. Staying up to date on technology pays off

For a year or so before the pandemic, I had it on my to-do list to get to know and make better use of videoconference apps like Zoom and Skype. But I never got around to it. In March 2020, we all – and I do mean all – got a crash course in Zoom. While there has been some Zoom fatigue, being able to videoconference has been a game-changer for companies, and it’s so much more efficient than traveling to in-person meetings.

While I can’t wait to see colleagues and clients in person again, I plan to keep using Zoom, too. And I plan to research what technologies and apps I need to get to know next. Why wait until a crisis to find an app or software that can help my business right now?

2. Pivoting opens up new possibilities

I didn’t pivot in my business. But many business owners did with virtual offerings, new product lines and entirely new businesses. For example, “ghost kitchens” made it easier for some entrepreneurs to enter the food service industry. Without the pandemic and our so-called new normal, that idea might never have been dreamed up.

I didn’t have to pivot. I was already working from home, and thankfully demand for communications and PR services stayed consistent. However, I often think about what a pivot would look like for me and my business. The pandemic has made it clear that we can’t always count on things to always stay the same. I’m going to keep challenging myself to think about what pivoting could look like for me: “If x happened, I would…”

3. Communicating effectively is everything

I can’t tell you how many times in the last year I’ve heard someone say that it all comes down to communication. And usually it isn’t because a company or organization is doing a great job at it. Communication really is everything. When it comes to communicating during a crisis, it’s important to start from within.

You can’t communicate effectively with your customers and the rest of the outside world if you aren’t first to communicate with your employees. They are your ambassadors, your frontline. How you communicate with your own team members – in good times as well as challenging times – can make your people feel incredibly connected and valued or just the opposite.

How do you want current and past employees talking about you in the world? The news you have to share might not always be what people want to hear, and people get that. But it’s important to deliver your message in a timely and transparent way.

When clients come to me for crisis communication advice, I always ask first about their employees. How are you communicating with them? I’m of the opinion that if you are drafting a media statement, employees should probably know about it before they hear or read about it in the news.

And from now on when clients come to me for crisis and issues management, I’m going to remind them that we’ve got this. Remember 2020?

Read the original article on Business Insider

4 ways businesses can better attract and recruit new talent

Job interview
Recruiters should go beyond LinkedIn to source potential employees.

  • Office culture is important to people in their job search, says employee engagement and diversity expert Bernard Coleman.
  • Businesses can attract new talent by proving they care about what matters most to future employees.
  • Coleman believes recruiters can source better talent by expanding their search pool and engaging with those that’s right for their company.
  • Visit the Business section of Insider for more stories.

When it comes to recruiting well, it is an art as much as it is a science. Unfortunately, many organizations aren’t unlocking the full power of recruiting, and are settling by using outdated processes.

To attract the best and brightest, you need to make sure your recruiting strategy and team are up to the challenge and are up-to-date for what the future of recruitment will look like. So if your organization really wants to succeed, your recruiting needs to level up, and fast. Here are four essential ways to supercharge your recruiting.

1. Change where you look for talent

A lot of recruiters look for talent in the exact same places: the same universities, the same companies, etc. Instead, sourcing should be like fishing: Cast a wide net and go where the fish are. Because if every recruiter is sourcing from the same places, they are effectively overfishing and creating a perception of scarcity.
 
The perception of talent scarcity typically comes from a combination of three elements: overtaxed pipeline, lack of knowledge, and speed over precision. All three elements are solvable.
 
First, expand the search to find more talent by looking in new places. If you normally recruit at schools, change it up and choose new alternatives like historically Black colleges and universities (HBCUs) or Hispanic-serving institutions (HSIs) that match your general skills and needed criteria. Second, study up on the type of talent you’re seeking and find where they congregate. Simply put, go where the talent hangs out virtually and in-person to build presence and relationships.
 
Further, deploy more complex Boolean searches to achieve richer results on websites like LinkedIn. The greater specificity, the better. Finally, proactively build pipelines to create evergreen channels instead of reactively starting new searches.

2. Better define your employee vision proposition

Talent naturally wants to know what it’s like to work at your company. They’ll look at the company website, read Glassdoor and other places that convey the culture so the employee value proposition (EVP) needs to be crystal clear. Talent needs to know what the company stands for, what the company is committed to, and they want to connect to the mission beyond the boilerplate language.

People are interested in diversity and inclusion, in what office culture feels like, how people treat one another, to know they’ll be engaged and set up for success. Overall they want to know the entirety of the employee experience. That’s why the EVP must be clearly understood in words but also in actions. Organizations have one time to make a great impression.

3. Go beyond LinkedIn

LinkedIn is a powerful tool. But used in isolation, it is an incomplete plan, and over-reliance on any one tool is a limiting strategy. Great recruiting requires a differentiated approach. You should use different tools because all talent isn’t listed on LinkedIn.
 
Try using Twitter lists, where you can follow certain industries like technology and sub-categories to find different ways to connect to candidates. Leverage Slack and explore the numerous communities to informally source and start up conversations with passive candidates.

Using all the tools, you can have improved outcomes and find talent that’s off the beaten path.

4. Gatekeeper versus door opener

Recruiters have a great deal of influence and should lean into how they can maximize the recruiting experience. Recruiters are the first people talent meets and should act as door openers to opportunity, as opposed to gatekeepers.

Roz Francuz-Harris, director of technical recruiting at Zillow and host of the podcast Y’All Hiring, put it well when she said to be mindful of your impact on job seekers at one of their most vulnerable points in life. When you act in a way that is either elitist or not fully transparent, it creates an image of a gatekeeper. As a recruiter, you want to be talent advisors to clients, add value, and be an asset to the business.

As much as you are interviewing the applicant, they are interviewing you and gauging the acceptableness of the culture. At the end of the day, as the saying goes, you’re not just recruiting employees, but are sowing the seeds of your reputation.

Read the original article on Business Insider

How to choose between an in-person, hybrid, and remote work model for your business post-pandemic

Remote work
Companies can decide to have employees work entirely remotely or predominantly in person.

  • The pandemic has forced organizations to rethink the office work structure.
  • Post-pandemic, many leaders will have to decide what’s the best work model for their businesses — in-person, remote or hybrid.
  • The future of work requires careful planning for both business leaders and their employees.
  • Visit the Business section of Insider for more stories.

After about a year of working remotely and making changes due to the pandemic, many leaders are confronting the same crucial question: What does the future of work look like in my organization?

As a leader, you must decide what workplace model you want to use, considering the needs of your business and your employees. Generally, organizations will have three options: entirely remote, predominantly in person, or a hybrid of the two.

Before you decide, it’s important to know the merits and drawbacks of each model. Here’s a quick rundown:

Predominantly in person

Before the pandemic, many organizations had nearly all employees in an office most days, and some feel an inclination to return to this workplace model. Some organizations have struggled to create a fully collaborative environment while working remotely, and Netflix CEO Reid Hastings spoke for many detractors when he called remote work “a pure negative.”
 
Companies that have encountered remote work challenges may want to go back to simpler, pre-pandemic times. If you’ve led a highly successful in-person organization, it’s natural to want to regain that degree of organizational success, collaboration, and camaraderie.
 
But companies must know that while many employees cannot wait to return to the office, others have decided they prefer remote work and have even moved far away from their former office. Freelancing and hiring company Upwork found that 23 million Americans plan to relocate in response to increased remote work opportunities. These employees may decide to pursue a new job if coming back to the office is mandatory.

Before returning to a purely in-person model, get a sense of what people want by either having managers collect intel or distributing an anonymous survey. If your employees predominantly want to continue working remotely, it may be worthwhile to listen.

Fully remote

While some companies have struggled remotely, many prior skeptics have embraced remote work in the pandemic. Companies as large as Twitter have even told employees they can work from home forever.

The benefits of a fully remote model are apparent – being completely virtual allows companies to save on office space and in-office technology, such as remote friendly conference rooms and office servers. In addition, remote work can give employees the flexibility they didn’t know they craved, allowing them to set a better schedule for themselves, be more productive without the distractions of an office, and be more present outside work.

However, companies shouldn’t be replicating all their in-person workflows, meeting routines, and management approaches in a newly virtual organization. Instead, the best remote companies help their employees engage and collaborate while working from home, share strategies to help their people manage a remote workday, and invest in employee necessities by offering laptops, office supply reimbursements, or high-speed wireless subsidization.
 
That said, be aware of and think of ways to accommodate the people who were looking forward to coming back to the office and won’t be excited to find out there isn’t one.

Hybrid

It’s crucial to know that creating a hybrid work environment requires a careful strategy in and of itself; it’s not a way to avoid setting a clear course. Leaders of hybrid organizations must create an environment where employees are consistently available and every team member is engaged professionally, even if they rarely come to the office.

Hybrid organizations have one clear advantage: They give every employee an opportunity to work however they want, whether that means coming to an office consistently, working from home every day, or something in the middle. Hybrid organizations also have the benefit of a ready-made office space for in-person meetings, training, team building, and more.

However, hybrid organizations need to ensure everyone is integrated into their work environment, regardless of where or how they work. There must be clear expectations and norms about when employees can work remotely and when they should be in the office. Leaders must plan in-person meetings and collaboration carefully, rather than abruptly calling employees into the office for conferencing. Most crucially, they must ensure that employees who work from home frequently are not passed over for advancement and recognition, and don’t fall into social isolation.

Companies should weigh these three workplace models carefully, and not thoughtlessly gravitate to the style that is closest to what they’ve always done. You should also be ready for a healthy percentage of your workforce to opt out of the model that you choose, as many folks are discovering new preferences for how they’d like to work.

Don’t try to be everything to everyone. Choose your strategy, support it, and be honest with the people in your organization about where you are heading – knowing many of them might choose to head in a different direction after their own experience over the past year.

Read the original article on Business Insider

7 key strategies for scaling from a solo entrepreneur to a successful business leader

colleagues in work meeting
Teams thrive when they have a higher purpose and long-term goal.

  • Entrepreneurs should adjust the mindset of doing everything solo to building a team to grow their business.
  • A culture of learning from failure is key to becoming a successful business leader when scaling a startup.
  • Fine-tuning the business’ purpose is important for entrepreneurs becoming team leaders.
  • Visit the Business section of Insider for more stories.

As an adviser to many startups today, I still see that most of you entrepreneurs see yourselves as the sole driver of your new solution, and the key driver of your new business.

That’s not all bad in the beginning, but as you scale, every business has to build a team to keep up with the wide range of skills needed, fight new competitors, and respond to changes in the marketplace.

For many, it’s hard to make the switch from that top-down, order-giving culture, and it’s hard to find the time to recruit and coach the new team members you need to scale the business to success.

Many new businesses fail at this stage because they don’t build the required team culture to keep teams engaged and committed, and founders burn out trying to do too much.

Based on my own experience in large companies, as well as small ones, here are seven key strategies I recommend for building the teams and culture that will drive business success:

1. Admit to yourself and others that you need help

Don’t let your ego and passion prevent you from building a team around you, listening to others with complementary skills, and delegating decisions as far down as possible. We all need to be humble and recognize that what we need to know about technology and the market changes daily.

2. Identify a business purpose and goals that motivate any team

Today, modern teams are engaged by a higher purpose, such as improving the environment or helping the underprivileged, more than just money and profit. You need them to make a personal commitment to customer service, improved quality, and change to improve the future.
 
Blake Mycoskie, founder of Toms Shoes, set a goal of donating a pair of shoes to the needy for every pair sold, and maintains team commitment by providing international trips to assist partners in distributing shoes in interesting places, including Nepal and Honduras.

3. Encourage your team to make decisions and take action

Many teams I know are frustrated by never-ending debates and constant requests for more analysis by management. Satisfaction and commitment come from choosing a path to move forward, evaluating results and customer feedback, and learning from all their best efforts.

4. Keep teams small, diverse, and collaborative 

I find that teams with more than eight or nine people often get bogged down in internal politics and have trouble sharing data effectively or reaching consensus. People all need to trust each other and be able to recognize the value of diverse perspectives. Avoid long and never-ending projects.

As an example, CEO Jeff Bezos at Amazon is known for his two-pizza rule: No meeting or team should be so large that two pizzas can’t feed the whole group. He is convinced this assures maximum productivity and that no one’s ideas get drowned out or ignored.

5. Practice active listening and open team communication

As the size and number of your teams grows, the amount of time you spend listening and communicating must also grow. Resist the urge to limit what teams need to know, interrupt negative messages, or jump quickly from listening to a solution. Promote the sharing of ideas and feedback.

6. Foster a culture of constant learning, even from failures

Many new business leaders can’t wait to implement fixed team processes to improve productivity and minimize risk. While productivity is important, the bigger risk is not learning from customers and the market and falling behind. Reward new ideas, experiments, and critical team feedback.

7. Be the model of customer focus for the team

Too many business leaders I know retreat further and further from the customer as their business scales. Make sure you schedule time for regular customer visits, and make sure your team understands that providing value to more customers is your definition of growing the business.
 
As your business grows from a startup to a sustainable business, you too have to grow from an entrepreneur to a business leader. Of course, if your interests and passion don’t lean in this direction, you can always bring in an outside CEO who already has the skills, or you can merge or sell your startup to another enterprise and move on to start a new venture.

Just be aware that a winning team makeup and culture won’t happen by default. It takes recognition of the need and effort on your part. I urge every entrepreneur to take a hard look at their own situation – you may be a key part of the problem, or the driver of the next unicorn business solution.

Read the original article on Business Insider

10 ways to manage stress and stay calm under pressure as a business leader

stress migraine
Overloading your mind with too many to-dos can lead to burnout and emotional outbursts.

  • Business leaders can use certain techniques to minimize stress and burnout at work.
  • Managing your daily workload, practicing delegation, and scheduling downtime can help reduce anxiety.
  • Building supportive professional relationships can also help leaders avoid being short-tempered and prone to outbursts.
  • Visit the Business section of Insider for more stories.

One of the most valuable attributes of a good business professional and leader is to be able to control emotional outbursts, to maximize your credibility and respect, and to maintain your own health.

The best of you train yourselves to show emotions sparingly and strategically, while the rest are convinced that emotions cannot be controlled, and are a function of culture and genetics.

Based on my own many years as a business executive and advisor, I have seen many professionals “mature” from hotheads to people who are cool and calm under pressure, becoming better leaders and decision makers in the process. 

With some coaching and mentoring from other leaders, I was able to do it myself. So I know you can do it too, by committing to the following strategies:

1. Train yourself to always look for positives, not negatives

Optimistic business leaders see value in every new business challenge, rather than stress and risk. You must recognize that change is the norm in business, so problems represent opportunities to learn something new, and improve your productivity and the competitiveness of the business.

2. Write down your top five core values and review them often

Pressure and emotion in business is often an indication of core value conflicts. Once you see and understand the conflict, it’s easier to make a decision, respond rationally, or simply remove yourself from the role. Don’t try to be someone you aren’t, or be everything to everyone.

3. Create a short to-do list at the beginning of each day

A mind overloaded with a large and growing list of critical items is not efficient, and will always be prone to burnout and emotional outbursts. I recommend a three-item high-priority list for focus. Then limit the external interruptions, so you can comfortably and effectively address each one, and more.

4. Practice delegation and decline unreasonable requests

Learn how to courteously turn back requests outside your realm of responsibility, and recommend others who may be more qualified. The most respected business leaders know their limitations, and are not afraid to admit them. Do the same for any commitments to the community and family.

5. Never schedule more than 80% of your time

Pressure and emotion become dominant when your schedule is overloaded, or too many predictable interruptions occur. Of course, most professionals are optimistic, so they tend to over-commit and underestimate work requirements. We all need a buffer to handle those special cases.

6. Put more focus on building the right relationships

Since business is generally not rocket science, relationships with peers, partners, and customers are often more important than skills. Find time in your work schedule for networking, working lunches, and business conferences, where you can test your ideas, learn, and generate support.

7. Define a clear break between work and private activities

Practice a ritual, such as a cup of coffee with a peer, to define your workday beginning, and maybe tea with your spouse to reset to family time. Then diligently don’t let these worlds intrude on each other, except in emergencies. Use the transition to reset stress pressures and emotions.

8. Never use emotion as a substitute for preparation

Effective business professionals always prepare for tough issues and key meetings by doing their own research and getting early counsel from experts and coaches. Not only do they do the homework, but they prepare mentally and physically to be at their best, rather than on the edge.

9. Take satisfaction from wins to balance against setbacks

No one in business wins every battle, so frustration on any issue needs to be offset by other wins and achieving incremental thresholds along the way. For most of us, this requires setting aside some contemplative time on a daily basis to measure key item progress and enjoy small wins.

10. Maintain at least one non-work passion for energy balance

Everyone needs a focus outside of work, such as a hobby, exercise regimen, or sports, to grant relief from work pressures and reset emotions. Emotional outbursts and losing one’s cool are often indicative of burnouts and pending meltdowns. Spread your energy to family as well as work.
 
Don’t let anyone tell you that what you can accomplish is limited by your culture or old habits. Everyone has the ability to control their own actions and emotions, which I find to be the keys to success in most business roles.

I encourage you to learn and practice the strategies outlined here, to minimize stress, and enjoy the journey as well as the destination.

Read the original article on Business Insider

3 tips for managing rapid startup growth, according to Peloton cofounder Graham Stanton

A rendering of Peloton Studios New York
Peloton’s fast growth required the company to reinvent itself repeatedly.

  • New startups should be prepared to adjust and reinvent quickly as they grow.
  • Peloton cofounder Graham Stanton says some of these rapid changes may move the company away from its initial business idea, and that’s OK. 
  • Don’t get bogged down in the details, Stanton advises, and look to your fans for inspiration on what to do next.
  • Visit Business Insider’s homepage for more stories.

Peloton cofounder Graham Stanton doesn’t want his employees to have all the answers.

During the early days of the stationary bike startup, the team’s inexperience was one of the company’s biggest assets, Stanton said Wednesday during a virtual interview hosted by Cedar, a healthcare technology company. 

“When I look back at my journey of Peloton and my colleagues, the ones who really succeeded were the ones who put in all the effort to learn,” Stanton said. He added that asking questions such as “How do I do my job today, because the way I did it yesterday no longer applies?” is key to getting ahead.

Founded in 2012 in New York City, Peloton launched with a Kickstarter campaign for its at home stationary bikes that stream virtual spin classes on monitors. The product tracks workout metrics that can easily be shared on social media. Peloton gained traction quickly from a loyal customer base and went public in 2019. The fast growth required the company to reinvent itself repeatedly.
 
“At one point, I joked that every year I felt like I was working at a totally different company,” Stanton said. “Now it’s every six months.”
 
Here are three tips for how to manage rapid change at a fast-growing company that Stanton said any flourishing startup should pay attention to.

Read more: 9 startups and companies that help small businesses succeed as sellers on Amazon

1. Don’t pay for focus groups if you don’t have to

In the early days of the company, Stanton didn’t want to pay a consulting firm to weigh in on decisions such as whether to make the bike’s color black or white. The time it would take alone could hold the company back, which is not conducive to fast growth. Instead, he moved quickly by simply emailing about 30 peers and asking for feedback. In this case, the response was almost unanimous to choose black. 

While you can get bogged down over every little detail before the product launches, Stanton says to “move quickly” and learn as you go.

2. Look to your fans for business ideas

The first Peloton Facebook group was run entirely by customers, who even organized meetups at Peloton stores to create their own community. Sensing potential, Peloton offered to take the Facebook group off the moderator’s hands and hired an in-house social media team to run the account. Soon, the company made sure Peloton stores were equipped with events and meet-and-greets with popular instructors to welcome the riders.

“It turned into a very official thing, but it was all leaning into the community that was already self-organizing,” Stanton said. Today, the Facebook group has 389,000 members.

Read more: What the future of coworking might look like for the self-employed as they seek out ways to network, collaborate, and set up shop

3. Always be ready to pivot – quickly

Before Peloton launched, Stanton was considering having user-generated content for classes, meaning anyone could film themself instructing a class and share it with other Peloton users. At the time, Stanton wasn’t sure what made the company “special” yet, whether that was the software, the bike itself, or the video content.

“We then realized that it’s the whole package and the experience,” he said. Rather than going the user-generated content route, the company changed gears and focused on in-house production with great music and professional instructor-led classes. The decision was key to creating the “true essence of Peloton,” Stanton said.

Read the original article on Business Insider