Investor Mindset Quotes

The best ideas are those that create a new mind-set or sense a need before others do, and it takes an astute investor to recognize an idea that not only is ahead of its time but also has long-term prospects.

The VCs were prolific. They talked like nobody I knew. Sometimes they talked their own book, but most days, they talked Ideas: how to foment enlightenment, how to apply microeconomic theories to complex social problems. The future of media and the decline of higher ed; cultural stagnation and the builder’s mind-set. They talked about how to find a good heuristic for generating more ideas, presumably to have more things to talk about. Despite their feverish advocacy of open markets, deregulation, and continuous innovation, the venture class could not be relied upon for nuanced defenses of capitalism. They sniped about the structural hypocrisy of criticizing capitalism from a smartphone, as if defending capitalism from a smartphone were not grotesque. They saw the world through a kaleidoscope of startups: If you want to eliminate economic inequality, the most effective way to do it would be to outlaw starting your own company, wrote the founder of the seed accelerator. Every vocal anti-capitalist person I’ve met is a failed entrepreneur, opined an angel investor. The SF Bay Area is like Rome or Athens in antiquity, posted a VC. Send your best scholars, learn from the masters and meet the other most eminent people in your generation, and then return home with the knowledge and networks you need. Did they know people could see them?

The Connection Algorithm is the great idea that keeps you up at night. It’s the hobby you can’t ignore. It’s the conference you’ve always wanted to attend. It’s the blog post that changed your life. It’s the investor who funded your project. It’s curiosity, courage, failure, and success. In a word, the Connection Algorithm is a mindset, and this book will teach you how to harness it and use it to your advantage. If you build this mindset into your life, it will accelerate your personal growth and naturally lead you to forge relationships with highly connected, successful people. It will also open your eyes to a new lifestyle, freeing you from the shackles of the 9-5 desk job. If this sounds too good to be true, it should. The doubt of the crowd affords opportunity to the few, which is precisely why the Connection Algorithm works.

If you're working on your own venture, rather than in a deep‐pocketed large company, you may well need to raise capital at some point. You'll raise that capital more easily, and on better terms, if you can demonstrate progress, of course. But “borrowing” the initial assets you need demonstrates something else, too. It shows that you're conscious of and serious about running a capital‐efficient business. Investors like that! A lot!

Surprisingly, at least to most observers, Tesla has not needed to raise any further equity since May 2019. Who needs investors—or bankers, either—when your customers are so excited about what you offer that they are willing to fund your business, with what amount to interest‐free loans, at that! As Bruce Sidlinger, already an owner of two Tesla vehicles reported, “The morning after the Roadster was announced, I put a deposit down … Elon Musk is one of our planet's great hopes. I would offer a kidney to him if he needed it.”20 Thus, here's a question for you: Can you find a way to get your customers to fund your business as generously as Musk has at Tesla? Perhaps, with the right mindset and a compelling offer, you can!

Some businesses take a unique approach to this. Footwear brand Toms, already beloved thanks to its renowned blend of “social purpose” and product, forgoes splashy celebrity marketing campaigns. Instead, they engage and elevate real customers. During the summer of 2016, Toms engaged more than 3.5 million people in a single day using what they call tribe power. The company tapped into its army of social media followers for its annual One Day Without Shoes initiative to gather millions of Love Notes on social media. However, Toms U.K. marketing manager Sheela Thandasseri explained that their tribe’s Love Notes are not relegated to one day. “Our customers create social content all the time showing them gifting Toms or wearing them on their wedding day, and they tag us because they want us to be part of it.”2 Toms uses customer experience management platform Sprinklr to aggregate interactions on Facebook, Instagram, and Twitter. Toms then engages in a deep analysis of the data generated by its tribe, learning what customers relish and dislike about its products, stores, and salespeople so they can optimize their Complete Product Experience (CPE). That is an aggressive, all-in approach that extracts as much data as possible from every customer interaction in order to see patterns and craft experiences. Your approach might differ based on factors ranging from budget limitations to privacy concerns. But I can attest that earning love does not necessarily require cutting-edge technology or huge expenditures. What it does require is a commitment to delivering the building blocks of lovability that I reviewed in the previous chapter. Lovability begins with a mindset that makes it a priority. The building blocks are feelings — hope, confidence, fun. If you stack them up over and over again, eventually you will turn those feelings into a tower of meaningful benefits for everyone with a stake in your business, including owners, investors, employees, and customers. Now let’s look more closely at those benefits and the groups they affect.

The best way to prepare for a climb to the highest altitude is first to acquire the right mindset and attitude.

Investors are in the market to make money, not to prove or disprove academic discussions. Follow what works for you, and let others follow what works for them.

Whether you get the cash you need—and whether it's to get started or to grow—from customers who pay early or from suppliers you can pay late, or from other unconventional or counter‐conventional sources, the sheer beauty of all of this kind of finance is what it costs you—nothing! You don't have to pay it back with interest, like a bank loan. You don't have to give up a stake in your business to a possibly rapacious or unhelpful investor.

Long‐time venture capital investor and Silicon Valley observer Bill Joy put it simply back in 2004: “Let's be blunt. Big companies almost never innovate. It's not that innovation is rare—it's occurring everywhere. Which means, mostly, elsewhere.

In my experience, product‐first companies are prone to becoming the “living dead,” as some investors call them, consuming never‐ending amounts of management effort, and sometimes round after round of investment capital, too, all to little effect.

Is the venture legal? Are there regulations that might limit or forbid it? Are there risks, including some perhaps previously unseen, that should be considered? Fortunately, in such companies, there are committees of all kinds and armies of lawyers whose main job is to protect the company from those unseen risks, avoid potential lawsuits, and keep its executives out of jail. Why? Many companies' leaders, at their core, don't like risk very much. They prefer as much certainty as they can get their hands on. If the company is listed on a stock exchange, they feel obliged to deliver the earnings that investors expect and deliver them consistently, quarter to quarter. No down quarters, please.

Wall Street treats all crises the same despite the fact that people react to the threat of war very differently from other crises like disease, systemic medical incompetence, or the failure to maintain a country’s transportation infrastructure.

That means adopting “a mindset of falsification,” always striving to “disprove” your hypothesis, and seeing “if it stands up to the assault.” One of Shubin Stein’s favorite questions is, “Why might I be wrong?