I was talking with another investor last week about what it takes to be successful in this industry and made the point that it takes a certain type of person to be able to remain human whilst repeatedly saying ‘no’ to entrepreneurs who are asking you to join them in pursuing their dream, and, even more difficult, occasionally saying no to the follow-on funding that would allow existing investments to keep going. This investor is a successful investment banker turned VC and he replied that all the most successful bankers he has known have an ’emotional off-switch’. Most of the time they are great people fully engaged across a range of emotions, but when the occasion demands it they say ‘this is business’ and proceed with what they think has to be done without emotion. We agreed that without an ’emotional off-switch’ it’s hard for people in senior roles to make consistently good decisions.
I’ve been dwelling on this since and have had three further thoughts:
- Whilst it’s important to assess the pros and cons of big decisions without emotion it is important to understand the impact the decision will have on the emotions of others (and yourself). If a course of action will cause emotional damage that should be on the list of cons.
- Flicking the ’emotional off-switch’ can’t be an excuse for bad behaviour. The responsibility to behave well remains unchanged.
- It isn’t just bankers and investors that need an ’emotional off-switch’. Entrepreneurs (and possibly everyone who takes big decisions) needs one too. Times when entrepreneurs need their ’emotional off-switch’ include when team members aren’t working out, when folks need to be hired in over the heads of the founding team, when customers are difficult and when new initiatives aren’t working out. It’s interesting to note that all of these examples are when things aren’t going well. That’s because letting go is emotionally challenging. Correspondingly, one of the most common laments I hear from successful founders is that they wish they had moved more quickly on difficult decisions instead of holding off in the hope that things would get better.
I suspect that many people wouldn’t like to have an emotional off-switch, but then leading companies and investing isn’t for everyone. For those of us who choose these vocations finding that switch and knowing when to use it are pre-conditions for success. Following this post I will be more mindful about how and when I use mine.