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5 Personality Traits Investors Look for in Entrepreneurs Attaining capital means impressing seasoned financiers and convincing them that your business, more than any other, is worthy of their time and money.

Edited by Dan Bova


Few companies get up and running without a bit of private capital giving them an extra boost, even in today's era of free resources, digital communication and crowdfunding. Attaining that capital means impressing seasoned investors and convincing them that your business, more than any other, is worthy of their time and money.

Initially, you might think that all investors make their decisions based on the business plan -- the hard facts of the business and the trajectory for growth that will make or break the company. But there's another set of factors just as important to most investors, and it's all in your personality. They realize that an entrepreneur with the wrong personality can ruin the chances of a brilliant business on paper, much in the same way that an entrepreneur with a perfect personality can breathe life into a merely decent idea.

Related: The Entrepreneur's Ultimate Tip List for Communicating With Investors

These are the personality traits that set entrepreneurs apart in the eyes of investors:

1. Sincerity

First things first: If you come off like a snake-oil salesman desperate to get his hands on capital, you'll immediately turn investors away. These are wealthy, involved people, and they've already been approached by some of the best swindlers and smooth-talkers in the business. If they feel that they're being misled, or that you are presenting yourself as someone that you're not, your reputation could be instantly ruined.

It's far better to honestly admit some of your shortfalls and concerns than to try to cover them up, and it's far better to act like your true self than to adopt a fake personality. To put it bluntly, investors have a great BS detector, so stay sincere and honest throughout all your interactions.

2. Charisma

Charisma is an intangible quality with multiple definitions, but essentially, it's a level of likability or charm that attracts other people. Initially, you might not consider "likability" as a key trait for running a business -- after all, a business owner needs to make objective, emotionless decisions for the benefit of the business before any human interest considerations. But at the same time, entrepreneurs are leaders.

Entrepreneurs are responsible for building and maintaining the team of employees who will drive the business forward, and responsible for attracting a first round of initial clients. To do this, they need some level of charisma, and investors look for this quality in potential investments.

3. Passionate

If you come to an investor meeting and simply run down the numbers in a monotone voice, your investors won't be impressed. However, if you come in visibly excited about your idea, to the point where you almost can't calm yourself down, they can't help but contagiously "catch" some of your enthusiasm.

Passion makes people work harder and more satisfied in the process of pursuing their goals. Without passion, entrepreneurs are far more likely to give up when trouble hits, and are far less willing to take essential risks to keep the business moving forward. Never be afraid to demonstrate your enthusiasm.

Related: Pitching Investors With Customer Motivations Won't Work

4. Humility

While charisma and passion can sometimes be associated with obnoxiousness or even arrogance, a level of humility is important to investors as well. Entrepreneurs need to be grounded with humility for several reasons.

First, they need to be willing to listen to outside opinions. As an entrepreneur, you aren't going to know everything, and you're going to make mistakes. Being humble enough to listen to outside insights is imperative to improve the business.

Second, they need to understand that not everything is going to be perfect. Humble entrepreneurs understand that mistakes and pitfalls will occur, and their ideas won't become successful overnight. This humility leads to greater long-term thinking, and more rational responses in a crisis.

5. Ambitious

Finally, in the eyes of investors, entrepreneurs need to be ambitious -- hungry for success. Investors look for opportunities to make more money, so they need to see that the business owners they invest in are equally eager to make money.

Ambitious people are far more likely to create goals, and are far more tenacious when it comes to facing problems. They're also future-focused, allowing them to make wiser long-term decisions than if they were merely concerned with day-to-day operations. You have to want success to earn success.

Obviously, it's hard to change your personality on a dime, and you don't want to pretend that you're someone you're not. But you can, through careful considerations and "putting your best foot forward," showcase the personality traits you have that make you a best fit for the business.

Don't be afraid to acknowledge this directly in conversation, and tell stories about your past experiences that prove your worth as an entrepreneur as potential investors engage you and try to get a better feel for you as a person.

Related: 8 Things You Need to Know About Raising Venture Capital

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