010 - INVESTORS DRIVEN BY 2 THINGS

Investors are driven by two things, narrative and return. The first gets 'em through the. And the second dictates the size of the check. Okay. This is pretty broad brush. I get it. But just before I go into the detail of kind of private transactions, think about how the stock market works. When you are buying a stock, someone else is selling it.  If everyone had the same information at the same time, there would be no alpha. There'd be no return because everyone would basically be trying to do the same thing at the same time. . But typically what happens is on either side of a trade, you have people with different opinions about what the future is going to hold.  When I bring it back to private markets, when investors are investing in an early stage startup, they're thinking about the narrative more than anything. Why? It has to interest them enough for them to dip their hand into their pocket and write that check. Most of the time founders get really stuck into the technical detail of what's happening in their product.  Or maybe they talk about the market in a way that you know is fairly flat or dry. What investors wanna see is a passion that you really believe in what you're building. They want the massive story of a huge outcome down the track, and they want to see that you are the person that's gonna be able to deliver that.  And that's all down to narrative. Secondly, they wanna see that return. They wanna see that there is an outsize opportunity for them to 10 x their money in five or six years. And that's what dictates the size of the check. So the narrative is what gets 'em hooked, and the return is what tells 'em how much they're gonna invest. In December of 2022 I released a list of 100 lessons I'd learnt the hard way operating as a CEO & CFO across multiple ventures from startups to scale ups to SME's. I had more than a million impressions on that post, thousands of comments and re-shares and many messages asking me to expand on these points. I'll be releasing a new episode every day for 100 days touching a little further on the headlines. Only a minute or two a day, and at the end you'll know my full list!