Hello to All,
As I am a newbie and learning Entrepreneurship through TRH and other platforms as well, I see various examples available about Funding and getting Started and observed that only big college degrees from IITs/IIM’s and Fortune 500 company executive get funding easily and others suffer.
So my point is why Investors look into degrees rather than their ideas? Why you need a fancy degree and designation stamp to have faith in the business? Is it a myth or reality that IIT/IIM’s or Fortune 500 company experience need to be carved on your head to get started and funded?
Are Investment firms doing another way of making money or they really help ideas and people in need?
Looking forward your views on my doubts.
Thanks,
Vishwajeet
Abhik Prasad
Investors invest in people because ” An idea is nothing. Execution is everything”.
Everybody has dime-a-dozen ideas but only very few people can execute and implement it successfully. Ofcourse that doesn’t mean that an idea is not important but just a good idea is not good enough.
Now why do investors invest “only in IIT/IIM or Fortune 500 co executives” ?
Am not sure if its completely true and to a large extent, a perception created by the media. There are tons of successful startups run by people from lesser known colleges and companies.
However, even if that were to be true, I would assume it would probably be because of the ‘Birds of a feather flock together’ syndrome.
Nishant Agrawal
Precisely my views on the topic
Aparna
Well, I would like you to think on the perspective of an investor… what should do to reduce the risks? How will I not lose the money?
An investor is interested in money and only money. Specifically he is interested in how fast his investment will double/triple. That means, he has to look at two things – how to grow his money and how not to loose his money.
One of the things that IIT’s/IIMs have is the brand which can sell – less risks. Sadly, it sells because of perception of the society not just the investor.
Said that, thanks to internet one doesn’t need a degree to learn a skill. And any skill can be monetized. The world/economy is changing slowly, people are starting to realize that education is not a mandatory. But, it will be a long time before the degree loses its value.
Yes, firms are changing. The reason is a 24 yr olds are now becoming a angel investor and such guys/gals think differently from their predecessors. But, again it will take a couple of years.
The best way to attract investment is to have a wholesome team. Ie, you can’t run a hotel without a chef.
Hope that helped!
Aparna
Investors invest in people for a long term interests. An idea has a lesser expiration date than the people :).
Sridhar V
Investor invest in people because ultimately its the people who can execute the idea and convert it in to a successful product/service. There the word ‘people’ is generic and not necessarily those from top management schools/universities or Fortune 500s.
The next part of your question where you specifically asked why investors look in to degrees or brand names instead of the ideas is quite interesting. This is a big Conspiracy that is eating away good ideas from people at grassroot level. Many people who are below poverty line or in lower middle-class or even middle-class (without fancy degrees or brands) have wonderful ideas and are enterprising. However, sadly none of the so called venture funds or PEs or private funds reach these individuals. Most of them have to rely on PSU bank loans, govt. schemes, etc which are accessible only to a few.
However, lets not write it off completely – there are cases were even normal people without great degrees received funding but these are just one off cases.
Probably Rodinhoods who are investors, VCs, etc can answer this question better.
Umakant Maurya
Actually they try to judge person’s quality through their certificate. Is he capable of thinking about the questions n give right answers to the world. Certificates gives you preference but finally Brain survives in the market. And I believe in earning people rather than earning Money… Once you earn people they will earn money for you. Bad manager can destroy your good business but Good manager can convert your bad running business into healthy business.