'People are winners, ideas aren't'

"We are backing more the person; the idea comes next," said Bharat Banka, CEO and Founder, Aditya Birla Private Equity. The rationale for weighing the entrepreneur rather his the idea was explained by Suvir Sujan, co-founder and Managing Director at Nexus Venture Partners, "We first assess the human being as we are going to technically get married to for about 10 years. The actual plan is secondary; you can't overlook the individual."

Ideas Change, People Don't

Mukund Mohan, CEO in Residence at the Microsoft Accelerator (MA), pointed out that in the 21 eligibility factors for investee companies refereed by MA don't attach much weight to the business idea. "We are looking for great entrepreneurs at the early stage of investments. Ideas don't matter to us at the stage we operate in."

This is true of many other considering early stage investments, where the start-up would actually comprise just one or two people and an idea with a handful of customers. "At the early investment stage, we aren't looking at the idea or the business plan. As the plan changes, the company changes, but people don't," Sujan pointed out.

Ajeet Khurana, early stage investor, mentor and entrepreneur, who was moderating the panel, agreed. He said more than half the 70-odd companies whose investments he had mentored were into a business vastly different than what they had started with. "You start creating opportunities along the way and end up building around those markets," explained Sujan. The Entrepreneur Himself

When investors question the entrepreneur about his idea, he figures the idea is the ultimate winner. But investors say they do that to examine the entrepreneur, not the viability of the idea. "We want to test their persistence," revealed Banka of Aditya Birla Private Equity. "There are 30 different ways to reach a solution. We check whether they have multiple ways to solve the problem."

But how do investors actually test the entrepreneur? "We do this by asking the entrepreneur why this particular idea; what if there is too much competition; and what path he plans to take to achieve his targets. We try to assess whether the entrepreneur is on the right track; how he would tackle the situation if either the idea or the path changes," explained Sujan of Nexus Venture Partner. So, the idea you present during your funding pitch may not necessarily end up attracting investors if you're shy and reticent or go in with Plan B.

On the other hand, you might earn brownie points for being resolute about your business plan. As Mukund said, "We see whether he or she has the ability to not give up."

Anshulika Dubey, COO and co-founder, Wishberry.in, a crowd-funding platform, too felt that people who fund ideas place their bets on the person pitching for the idea, rather than the idea itself. "People give you money for the person you are. They see whether you are convincing, confident, whether you will deliver."

Need A Strong Stomach

Apart from all the qualities needed to run a business, there is another important aspect that investors are testing. They are looking for thick-skinned entrepreneurs. Not just because people like this refuse to accept failure, but because they are able to stride past the difficult phases of the entrepreneurship journey.

Khurana said, "Entrepreneurship is an emotional journey and entrepreneurs face extreme loneliness." Not everyone can battle this phase. And, according to Sujan, "During this lonely journey, you would say, 'I have no market', 'There are no funds to pay salaries'. You would crumble as the stress is very high."

So newbie entrepreneurs would do well to learn an early lesson -- investors are looking to pick a tough entrepreneur who can stick it out.

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