You have heard the saying ‘every day is a school day’, right?
Essentially, the premise of the quote is the fact that we all have the ability to learn, grow and develop on a daily basis - lovely concept, sure. The term is also used, in a lot of instances, when us entrepreneurs learn lessons the hard way; those moments when we should have known better, those times where we should have trusted our gut or not allowed ourselves to get carried away and break our own rules!
I have had one of those ‘every day is a school day’ moments recently, when all you can do is sit back, after the fact, and say to yourself, ‘well, at least I know better for next time’! Yes, even experienced professionals, like myself, still make mistakes.
And on these occasions you have a choice; get frustrated with yourself and the situation or allow yourself the space to really sit in the moment and absorb the lesson that is available should you - and often your ego! - allow you to take it in!
In my case I committed a cardinal business sin… I made an announcement about my involvement in something BEFORE the ink was dry on the contract.
Successful Investor Rule No.1: NEVER DO THAT!
Now, in the moment of excitement, everyone is pulling to get things across the line, press waiting to announce, massive online coverage ready to go live etc. it is easy (all too easy in fact) to get swept up in the situation. I love business and I am always passionate about the people that I am investing in, so it is easy to lose sight of waiting until all the i’s are dotted and the t’s are crossed.
Having run huge companies with huge levels of intricacies and personally exited 6 businesses I know this, but even those of us who have been on the merry-go-round a few times, can still get over excited!
And, let’s be honest here, this is not uncommon in the world of VC, private equity and angel investment - just look at something like Dragon’s Den, around 53% of deals that are agreed in the Den and get significant airtime on the show never actually happen. By the way, those pitches are often hours and hours long, distilled into just a few minutes, so it shows how much still has to happen behind the scenes to make sure that due diligence is done and deals stack up, for all parties.
Lots of things can go wrong when it comes to legals and often lawyers are thrown under the bus for crashing a great opportunity, but you have to remember - especially in the moments where they are telling you things that you might not want to hear - they are being paid to protect your best interests.
Now, don’t get me wrong, there can be instances when lawyers (and accountants!) can be so risk averse that they try to protect you too much, but in the vast majority of cases, you need to go with the advice of the team who are being paid (handsomely!) to look after your best interests.
And that's exactly what's happened to me in the last few weeks. I was very excited about an opportunity that I was going to get heavily involved with but unfortunately, when it came down to it, legal teams couldn’t agree on certain contractual stipulations and we weren't able to agree terms.
Sometimes, in business, you are defined by the deals that you don't do.
And this was one of those times for me.
It takes a brave entrepreneur to admit that they were wrong and to walk away from what - on paper - looks like a fantastic opportunity. And sometimes, you’ve just got to know when you made the wrong call and have broad enough shoulders to carry the fact that this isn’t going to be one of the big successes in your portfolio.
The biggest thing that I've learned from this, the thing that I got wrong, was making an announcement about my involvement before everyone had signed on the dotted line. I shouldn't have announced it. I shouldn't have publicised anything until it was actually locked in.
It's not done until it's done.
So it would seem that I've still got a little bit of learning to do even at my age and with my experience.
I'm still learning things every day.
If I reflect back, I knew - even at the time - that the announcement was a mistake, but there was so much enthusiasm, so much excitement and there was a huge time demand on getting it announced. But I have to take responsibility for the fact that I went against my own intuition (yes, the same intuition that has helped me invest in some seriously successful business across the years!) and that is something I very rarely do.
I never like it when a deal gets so close and then doesn’t come to fruition and I'm licking my wounds right now, but the upside of this is that I now have space in my diary to take on other projects. This investment was going to take a big proportion of my time - as the scale up plans we had crafted would need a lot of my fast-growth experience - so the silver lining - which I always like to find - is that I can now look at other investments, consultancy requests and help other founders with their plans for fast-growth scale up.
Plus, one of my existing investments has just had clinical studies come back that could mean the trajectory of that business is set to skyrocket, so that will naturally need more of my focus.
With regards to the business I've had to walk away from, I genuinely wish them all the best - they are great guys with a great business, so I look forward to watching their success from the sidelines. The model they have created is great, so I’ll be a customer at the very least!
Lesson learned, every day is a school day!