As an angel investor, you get pretty good at sizing people up. You listen to their pitch, grill them on their financials, and check out their team. But sometimes, the real insights come from unexpected places. I recently developed an unconventional litmus test: I ask the entrepreneur to drive me somewhere. Seriously. You can learn a surprising amount about a person and their potential just by being a passenger in their car for a long ride.
Think about it. Driving isn't just about getting from point A to point B. It's a microcosm of how someone approaches challenges, manages risk, and makes decisions under pressure. So, suggest a road trip the next time you consider funding a startup. Here's what you should be watching for:
1. Level of Awareness: Is this person present and engaged with their surroundings? Are they constantly checking their mirrors? Do they notice the traffic flow, pedestrians, and potential hazards? And do they do all this almost passively while staying present and attentive to your conversation?
This translates directly to their business awareness. Are they attuned to market shifts, competitor moves, and potential roadblocks? Or, are they only focused on their company and their product?
An almost natural awareness makes for a market-focused entrepreneur.
2. Offensive Versus Defensive: Are they timid and hesitant, always reacting to what's happening around them? Or do they drive with a confident, proactive approach, anticipating situations and positioning themselves for success?
On one trip with an entrepreneur, we were ten cars deep from the traffic signal. The entrepreneur told me he was concerned about the truck, the first vehicle at the light. I was impressed. He was thinking that far ahead.
In business, you want someone who can take initiative and drive growth, not just constantly play catch-up. They see what is coming and adjust their strategy accordingly.
3. Sense of Urgency: Do they dawdle and miss opportunities to progress, or do they have a healthy sense of urgency? This isn't about reckless speeding, but about moving with purpose and efficiency. They move with traffic flow but find the openings to stay ahead of the pack.
In the fast-paced world of startups, timing is everything. You need a leader who can seize the moment and keep things moving forward.
4. Focus: Are they easily distracted by their phone, passengers, or the scenery? Or are they laser-focused on the task at hand – getting from point A to point B safely and efficiently? They know they are in the driver’s seat and it is their job to drive distraction-free.
A lack of focus in a driver can signal a lack of focus in a leader, someone who might get sidetracked easily and lose sight of their goals.
5. Seeing Ahead: Do they only react to the immediate situation, slamming on the brakes at the last second? Or do they look ahead, anticipate traffic patterns, and make smooth, calculated moves? They are never surprised at what happens as they anticipate traffic patterns and individual drivers’ movements.
This speaks to their strategic thinking. Can they see the bigger picture in their industry, anticipate future challenges, and plan accordingly?
6. Safe or Reckless: This one is obvious. Are they putting themselves and others at risk with aggressive lane changes, tailgating, or ignoring traffic laws? Do they drive faster than anyone else, but you still feel safe with them?
While entrepreneurship involves risk, it shouldn't be reckless. You want someone who understands calculated risk and prioritizes the long-term viability of their venture over short-sighted gains. But they must be comfortable with going fast.
7. Knowing When and Where to Speed: This is nuanced. It's not about getting a ticket; it's about understanding when it's appropriate to push a little harder and when it's crucial to exercise caution. A smart driver knows when to accelerate to merge smoothly or pass safely, and when to ease off the gas in congested areas.
This reflects a leader who knows when to be aggressive in pursuing opportunities and when to be prudent and manage risk. The last entrepreneur I drove with said, "I drive offensively but not recklessly. Safely. And I use the whole road.”
This is the balance you want in an entrepreneur.
So, the next time you're sitting across the table from a promising founder, suggest he take you for a ride. Offer to grab coffee a few miles away or check out their new office space. Pay attention to how they handle themselves behind the wheel. You might just gain a whole new level of insight into the person you're about to entrust with your money. It's not foolproof, of course, but it's another valuable data point in the complex equation of evaluating an entrepreneur. You might be surprised at what you learn.
Better to be taken for a ride in his car than for a ride in his company.