“This is your last chance to invest.” Whenever I hear that, I cross the company off my list.
Occasionally, a founder tries to FOMO me.
I understand why they do it. They need to close the round.
But this technique works against you. In 5.5 years investing, every founder who tried to FOMO me shared one trait.
They had nothing else to sell.
You would think the most successful founders would be the ones to amp up the FOMO. Wrong.
The best founders just present information. You’re in or out.
It’s the weak founders that rely on FOMO.
Any investor with a modicum of experience will see right through it. Your chance of getting a check will go to zero.
So, if you shouldn’t rely on FOMO, what should a founder in a tough position do?
If you’re getting mostly no’s, you need to improve the position of your business.
Getting more customers will help you get investors. Telling investors they’re “about to miss out on something big” or “losing out on a really hot deal” doesn’t help.
FOMO turns off knowledgeable investors. But can you use it profitably on newbies?
Maybe. But you don’t want those people in your round.
Say you grab a few angel checks from noobs using FOMO. If your company struggles at any point, those people will make your life a living hell.
They don’t understand that all startups struggle and 90% go to 0.
Experienced investors do.
We’re a little harder to pin down. But once we’re in, we’re in.
So the next time you’re tempted to FOMO an investor, stop.
Instead, present your pitch calmly. Rely on facts.
If they like it, great. If not, move on.
And if you want to increase your odds, focus on building a better business. That will get you a lot further than FOMO.
More from the blog:
When It’s Okay for Investors to Add Zero Value
You Finally Closed Your Funding Round — Time to Panic?
The Best Founders Take Time to Rest
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