Last week I was being interviewed for a newspaper article and one of the questions I was asked was, “Are there any deals you wish you did but didn’t…ones that got away?” I replied by saying that every single person in my business, if they are telling the truth and have worked long enough, has five deal-related lists, as follows:
- their current and past successful investments
- deals they wish they had never done
- deals they really wanted to do but they got aced out by other investment firms because of competition for valuation or whatever
- deals they could have done but didn’t and they regret it because someone else did them and made beaucoup bucks because of it
- the craziest deals they have ever seen
I definitely have all five of these lists and I have even written on the 5th one before HERE, although I may be due for a reprise since it’s been a while. On the real life entrepreneurial front, there appears to be no shortage of crazy stuff out there. Have you seen Shark Tank? Seriously, who comes up with this stuff? Someone should do a study matching the city of origin of some of the crazier ideas with the number of meth lab arrests in that same locale. I have to believe there is a relationship here; correlation or causality? Who knows?
The fact is, however, that some ideas that sound bat-$%#@ crazy turn out to be good. $4 coffee? What? Are you nuts? Who is going to pay $4 for coffee that you can pay $1 for or make at home, for God’s sake? Hello Starbucks. So the truth of the matter is that if you are a great investor (and have a little bit of luck) you can distinguish between what is crazy but just might work and what is crazy and should put the entrepreneur in an institutional setting for a minimum 30-day stint.
To that end, Ali G, aka Sacha Baron Cohen, provided one of the world’s funniest examples of this, albeit as parody, when he went around Silicon Valley to pitch the ice cream glove to actual VCs.
A few weeks ago I saw another funny one on Saturday Night Live: comedienne Melissa McCarthy, as Barb Kellner, goes looking for capital for her pizza-eating business, whereby she acts as an outsourced provider for the eating of leftover pizza. She goes to a potential financing source and passionately starts her pitch, to which the investor responds,”I’m sorry, you expect us to give you money so you can eat pizza?” She then responds with gusto, “Yeah, man!”
I love it. A woman CEO, first of all, and one who has the courage of conviction in her idea.
The target investor adds, “What gave you the idea that the bank would give you money so you could eat pizza?”
To which Barb says, “I was familiar with that book Do What You Love and the Money Will Follow and I said to myself, ‘Barb, you love eating pizza!'”
But it’s the end of the video that reminded me of so many entrepreneurs that I have met and explains why they are so much fun to work with: they are just entirely confident they have discovered that mission critical concept for which the whole world is clamoring. Enjoy the video and I hope you get a good laugh, particularly if you are one of my investor friends.