Throughout my entrepreneurial journey, I’ve experienced both sides of the coin—being a founder and an investor.
Each role demands distinctly different mindsets and approaches. Understanding these differences has been pivotal to my career and has deeply shaped my philosophy in business and investing.
Here are the differences and what you need to know.
Table of Contents
The Founder’s Mindset: Optimism and Naiveté
As a founder, I’ve discovered that embracing optimism and even a level of naiveté is critical.
It might sound contradictory, but coming into a business with a certain level of blindness to challenges can actually be an advantage.
When I’ve started businesses, I’ve intentionally chosen industries where I wasn’t overly familiar. The logic behind this is simple—if I had fully grasped all the difficulties upfront, I might never have taken the leap.
Reflecting back, many of the ventures I’ve launched came with unforeseen complexities. If I were asked now whether I’d jump into some of those ventures again, knowing what I know today, I’d probably say no.
Many businesses I’ve ventured into posed challenges far beyond my expectations. But precisely because I didn’t fully grasp the complexities initially, I was forced to innovate solutions quickly—often turning apparent setbacks into opportunities.
The Investor’s Mindset: Skepticism and Discipline
Transitioning from founder to investor requires shifting gears dramatically. Unlike the enthusiastic optimism that drives a founder, an investor needs to approach opportunities with disciplined skepticism.
The default answer for an investor must typically be “no” because most opportunities won’t pan out. It’s essential to be able to read people, understand their grit, and judge their ability to navigate the inevitable failures ahead.
As an investor, I’ve learned to embrace the reality of frequent pivots and business model shifts. Investing is fundamentally about backing resilient individuals because the business they start is rarely the business they end up growing.
A memorable example involves Lucy Guo, founder of Scale AI. Her early investors backed an entirely different idea initially—an app designed to skip nightclub lines.
The eventual pivot into AI training models wasn’t the original business investors signed up for. This illustrates perfectly how the original idea often matters less than the adaptability and resilience of the founder.
Investing in the Person, Not the Idea
Early-stage investing, in particular, is less about evaluating the business idea itself and more about assessing the founder’s ability to persist and pivot.
I always look for founders with grit—the people who can handle repeated rejection, stress, and failure, yet still choose to show up each day. The initial pitch often evolves dramatically, and investors must anticipate this.
Finding the Balance
Having navigated both these roles, the key lesson I’ve learned is to maintain clarity on which “hat” I’m wearing at any given time. Living in both worlds means knowing which hat I’m wearing at any moment:
- Founder hat: Say yes, leap first, and figure it out on the way down.
- Investor hat: Start at no, interrogate the risk, and bet only on founders who’ll keep showing up after the ninth rejection.
As a founder, I’m driven by vision and possibilities, willing to tackle seemingly insurmountable problems head-on.
As an investor, I remain cautious, analytical, and aware of the high risk involved, prioritizing character and resilience above all else.
Recognizing and mastering these distinct mindsets has made me better at both starting ventures and making strategic investments, each feeding valuable insights into the other.
Follow me on LinkedIn for insights like these.