{"id":121,"date":"2009-10-22T14:58:22","date_gmt":"2009-10-22T21:58:22","guid":{"rendered":"https:\/\/berkonomics.com\/?p=121"},"modified":"2009-10-22T14:58:22","modified_gmt":"2009-10-22T21:58:22","slug":"2-management-quality-trumps-a-quality-plan","status":"publish","type":"post","link":"https:\/\/berkonomics.com\/?p=121","title":{"rendered":"2. Management quality trumps a quality plan."},"content":{"rendered":"

Great management teams mean more to investors than even greater business plans.<\/em>\u00a0<\/p>\n

If flexibility and coachability are first in the list of traits investors value in an entrepreneur, then the quality of the proposed or actual management team come in a close second, even before the attractiveness of the business plan itself.\u00a0 The quest for a great management team is not a fluke, but rather a result of backward looks at the failure rate from past investments by angel investors and venture capitalists.<\/p>\n

It is true that at least half of the businesses backed by professional early stage investors will die within three years or less. That reality is a tough one for the professional investor, almost as tough as for those entrepreneurs who lose their businesses.\u00a0 The latter can start new businesses, flush with the experiences gained from the previous effort and much the better for it.\u00a0 The investor\u2019s cash is lost forever, and the experience gained usually is just another increment in a list of similar experiences from the past.<\/p>\n

[Email readers continue here…]<\/em>\u00a0<\/span> It is the management team, most often led by a passionate entrepreneur with experience in the industry, which makes the biggest difference between success and failure, even for businesses built upon less than sterling basic ideas.\u00a0 Among professional investors, almost all would rather back a great team with an average idea before a great idea and inexperienced team.\u00a0 It comes back to coachability and flexibility, our first insight.\u00a0 Great teams are flexible and have the advantage of experience in seeing the pitfalls before them from their past.\u00a0 They are coachable in that they have taken advantage of the vast experience of others in overcoming obstacles and finding ways to speed a product to market faster or create a service whose quality exceeds that of the competition.<\/p>\n

None of this is to say that an inexperienced entrepreneur cannot lead a great new business.\u00a0 But it would be foolish to try without surrounding himself with as many experienced co-leaders as possible from the outset.\u00a0\u00a0 As a start, such an entrepreneur will soon \u201cknow what he (she) doesn\u2019t know\u201d, an important qualifier for success in any business endeavor, when combined with the willingness to fill gaps in knowledge with help from those who have the experience to do so.<\/p>\n

\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0 Ask any professional investor, and you should hear that they value the quality of the team above the attractiveness of the early drafts of the business plan.\u00a0 Even without taking in money from professional investors, that advice would serve you well in protecting your own monetary investment.<\/p>\n","protected":false},"excerpt":{"rendered":"

Great management teams mean more to investors than even greater business plans.\u00a0 If flexibility and coachability are first in the list of traits investors value in an entrepreneur, then the quality of the proposed or actual management team come in … Continue reading →<\/span><\/a><\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"om_disable_all_campaigns":false,"_exactmetrics_skip_tracking":false,"_exactmetrics_sitenote_active":false,"_exactmetrics_sitenote_note":"","_exactmetrics_sitenote_category":0,"_uf_show_specific_survey":0,"_uf_disable_surveys":false,"footnotes":""},"categories":[4],"tags":[],"class_list":["post-121","post","type-post","status-publish","format-standard","hentry","category-ignition-starting-up"],"aioseo_notices":[],"_links":{"self":[{"href":"https:\/\/berkonomics.com\/index.php?rest_route=\/wp\/v2\/posts\/121","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/berkonomics.com\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/berkonomics.com\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/berkonomics.com\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/berkonomics.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=121"}],"version-history":[{"count":0,"href":"https:\/\/berkonomics.com\/index.php?rest_route=\/wp\/v2\/posts\/121\/revisions"}],"wp:attachment":[{"href":"https:\/\/berkonomics.com\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=121"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/berkonomics.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=121"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/berkonomics.com\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=121"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}