New Terms and Conditions from Venture Capitalists: Leadership Development

The world of entrepreneurial startups continues to boom, pandemic or not. From coast-to-coast, business incubators and entrepreneurial centers are filled to capacity, all hoping for their big break and a shot at becoming the next Uber or Amazon. It’s a wide-open playing field for venture capitalists, looking to back winners in exchange for an equity stake. To get their attention, startups must steadfastly demonstrate their business acumen in order to make themselves an attractive proposition. A strong balance sheet, pro-forma, and robust business plan meet the minimum standards, but another factor is fast becoming a prerequisite prior to the onset of funding talks—executive leadership coaching.

Before investing, venture capitalists thoroughly examine the organization’s leadership, looking to determine the C-suite’s capacity to lead and run an effective organization. In times past, they could strongly suggest a change at the top. But they’re increasingly suggesting—sometimes even requiring—C-suites to address their “leadership debt” by enrolling in executive leadership coaching. It’s another means of protecting their investment long-term.

Why Startups Fail

Harvard’s Noah Wasserman is one of the foremost authorities on startups and entrepreneurial ventures. According to a decades-long study of their performance in a number of categories, he found that over half of all startups—65%—fail because of what he deems, “people problems.” In a recent interview with the Economic Times, Wasserman lays out the primary problem:

“First, few founders have all the resources and capabilities needed to grow their start-ups to full potential, but attracting those resources and capabilities requires them to give up ownership and decision-making control to the cofounders, hires, and investors who can add those resources and capabilities. Second, the job of CEO in a fast-growing start-up changes dramatically at each stage, requiring skills that the typical first-time founder lacks but can’t learn fast enough to keep up with the demands of the position.”

Can’t learn fast enough? Do you know what might mitigate this issue? The kind of training you can find at Intelligent Leadership Executive Coaching. The high failure rate of startups is one of the three key challenges impacting organizations today. Without course-correction, organizations will continue to underperform and place themselves at-risk. Typical startup founders and leaders are enthusiastic about the problems they’re solving for their clients. But passion, drive, and motivation can’t be fully harnessed without proper executive leadership coaching.

We’ve no doubt all heard the phrase, “follow the money.” When venture capitalists—who provide a great deal of it to fund these entrepreneurial ventures—begin advocating for executive leadership coaching as a prerequisite for funding, the value of this requirement becomes quite obvious.

Intelligent Leadership Executive Coaching (ILEC) is the world’s #1 executive coaching platform dedicated to growing tomorrow’s leaders through organizational transformation. Our master certified ILEC coaches utilize a proven blueprint and philosophy designed to highlight the long-term benefits of investing in human capital. If you’re ready to take the all-important first step, let’s discuss your mission, vision, and purpose.

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