By now you should have read plenty of entrepreneur/VC advice on surviving in the post-mortgage crisis world. I won’t rehash it here, but 2009 will be tough and today’s difficult decisions will separate the next batch of startup winners and losers. One topic I haven’t seen covered much is the interpersonal opportunity that these tough times bring — for entrepreneurs and investors.
At my first couple funds, I was lucky enough to see the upside and downside of the tech bubble. During that time I worked with a diverse set of entrepreneurs and co-investors. The way they behaved individually and towards each other, during the tough times, shined a bright light on their strengths, weaknesses and character.
This is when the age-old question “Who do you want in your foxhole?” has real-life implications. An investor whose only advice is to cut burn without enough company awareness to help entrepreneurs prioritize, can be a dangerous foxhole roomy. An entrepreneur whose only thought is to request more funding to bridge the tough market, can be deadly. Investors or entrepreneurs who can’t pick up the phone to each other and grow their relationship during times like these, never will.
On the flipside, entrepreneurs and investors who dig-in together during times like these can build lifelong bonds. Likewise, startup teams that find ways to support each other and build a stronger business, gain a new family and stand to reap the rewards of a category winner when the macro environment clears.
So, if times like these shine a bright light on your weaknesses, strengths and character; what will your teammates, entrepreneurs and investors see in you?