Why a Strong Network Is a Startup CEO’s Superpower
Your inner circle should make it easier for your company to get what it needs
As a startup CEO, one of the strengths you bring to the table is an ever-expanding network of people who can add value to your company.
You should always be building your network, of course, but here’s something I learned late in my entrepreneurial career: It’s how you build that network that matters. And it’s only when you truly understand why you need your network that you’ll realize how to build it to your advantage.
Once you do that, your network goes from strength to superpower.
Let’s get started.
Build Your Network on a Foundation of Trust
I recently received a question from a startup CEO about where to draw the line on investor due diligence that was becoming invasive and painful.
In my answer, I talked about which functions of her startup needed to be an open book to investors (i.e. historical financial results), which areas needed more protection (i.e. proprietary source code).
But I also speculated on why that investor’s due diligence was so invasive. The startup CEO noted that she had no prior relationship with this particular investor. The investor had come out of the blue, so to speak. But now, what had seemed kind of like a windfall opportunity was turning into a drag on her business and her patience.
That was the root of it: A lack of trust. Everyone wants the shiny new relationship to benefit their business, but few want to put in the work necessary to make the relationship valuable.
Transactions Are Built On Relationships
Let’s think about due diligence for a minute and consider why it’s necessary.
You know that old saying, “Trust, but verify”?
That’s due diligence in a nutshell.
Whether the due diligence is for a customer sale, a capital investment or a startup acquisition, a lot of money is changing hands in order to produce a desired outcome. When someone spends a lot of money on something, they want to know…