People in the start-up scene know me as a numbers guy and I’ll admit, it’s hard to get a dud deal past me these days.

But believe it or not investing in start-ups is about more than making a buck – for me and most investors I know.

Sure, a deal has to make sense financially. That’s fundamental. Otherwise, call it charity. But once I’m satisfied with the numbers, I get behind a business for the same reasons an entrepreneur does. Passion.

What a start-up investment offers is the pleasure of seeing something worthwhile come to life. It’s about helping put fantastic products onto the market – ideally, the global market. For me, it’s also about putting Australian business on the map. And, soft as it sounds, it’s about helping people realise their dreams.

Which is why good chemistry between investors and entrepreneurs is critical.

Investing in start-ups is not for the faint-hearted. Anyone whose invested more than once knows they’re in for a roller-coaster ride that could end up almost anywhere. It’s a huge punt. And that’s part of the thrill. Otherwise we’d all be pouring our money into safe, boring, blue-chips.

Those tuning into Australian Shark Tank on TEN would observe many entrepreneurs turning up to pitch are after relatively small amounts of cash. (Others are asking for crazy amounts compared to their valuation.) On the first show, the inventor of an absurdly great idea, the portable electric skateboard, asked for a paltry $20,000 to grow his business. He’s well employed and arguably, could access that amount of money through his credit card or a personal loan. Yet he was prepared to give away a sizeable chunk of a business he’d been working on for 20 years. Why?

Because it’s not just about the cash for entrepreneurs either. Many of these participants are smart enough to know the involvement of a Shark and a Shark’s network is worth far more than cash.

The inventor of the infamous ‘Ham Dog’ food concept wasn’t after any cash at all – he was giving away his business to the right investment partner. Someone who had the credibility and the contacts to take that idea to the right commercial partners. The idea captured the imagination of Andrew Banks, who promised to make a few strategic calls to his connections in the fast-food business. One of those phone calls could propel the Ham Dog concept off the drawing board and onto fast-food menus around the world.

Not every Shark was prepared to make that commitment. Which is back to the chemistry. If the idea doesn’t light you up, if it’s not something you can easily and happily talk about to your connections, that should be a warning sign for an investor.

Here’s three things I’ve learned on the journey about how entrepreneurs can target the right investors.

FIND OUT WHO IS INVESTING IN YOUR SPACE. Investors tend to favour a particular type of business category. Generally, it comes from what they know, a territory where they feel most confident and know they can assist.

BE PREPARED TO BUILD A RELATIONSHIP WITH AN INVESTOR OVER TIME. Unlike Shark Tank, most investments happen after a number of meetings and discussions. Some investors I know take a year to make a decision about getting involved with an entrepreneur. During that time they are often listening, observing and offering advice. But once an investor is on board, treat them right and they are potentially the most likely source of further funds for your company – or for you as an entrepreneur if you go on to found another enterprise.

MAKE SURE YOUR EXPECTATIONS ALIGN. Some investors are indeed backroom and don’t want those midnight phone calls or monthly updates. Others will want a board seat and a running commentary on your progress. The best way forward in this area is to have an honest conversation and ask lots of questions. If you’re looking for coaching and introductions, make sure that’s clear from the outset. If you’re unprepared to give up control and take input from your investor, don’t pretend otherwise. It can only end in tears.

Start-up investment is not just a financial commitment, it’s an emotional commitment.

Along the way there will be tears, beers, late night phone calls and, hopefully, a few glasses of champagne.

Do you really want to take that kind of journey (typically 3–5 years without any financial payoff) with someone you don’t like or someone who doesn’t believe in you or your ideas? I don’t.

This article first appeared on Business Review Weekly. View the original here.

I’ve been investing in startups for more than a decade. In that time, I’ve been privy to hundreds of pitches from entrepreneurs and wannapreneurs and I’ve invested in over two dozen businesses of diverse shapes, sizes and interests.

The deal breaker for me on any investment is always the character, skills and attitude of the person behind the business.

As the saying goes, start-up investors don’t invest in ideas, we invest in people.

It used to take me months to form an initial assessment about an entrepreneur. These days it’s more likely to take minutes. My listening and observation skills have become honed through this process – and also the school of hard knocks (not all investments go to plan.)

Being part of Channel Ten’s Shark Tank series as a ‘shark’ was a great test of my investment intuition, with sharks needing to make a judgment call in less than 30 minutes about where we would place our money.

On the opening episode of Shark Tank, two clever businessmen from South Australia pitched their Cricket Cooler product. What’s not to love about this product? It’s a cooler that doubles as a cricket wicket, saving families from the age-old tradition of cobbling together a cricket pitch from driftwood or a fishing rod. Like many great ideas, it seems like an obvious invention. It’s hard to imagine why this product hasn’t been on the market for years.

When Adam Dubrich and Leigh Warren stepped into the tank, they were revenue positive, having already sold 4,000 coolers with a roughly 50% profit margin. They’re smart enough to own the patent for the product in most overseas markets and have their sights on expanding offshore.

The product was good, the pitch was going great. Then we hit a snag.

The duo confessed they were spending as much time on the new enterprise “as they could”, and planned to give up their day jobs when they could replace their income through the Cricket Cooler revenues.

In that moment, I decided I was out.

A true entrepreneur is not someone who transfers from a comfortable job to a comfortable job. At least, not if they want to be a successful one.

I don’t want to put money into a business with a part-time manager. To me, the telling sign of business success is when the person behind the idea truly has skin in the game. If they aren’t prepared to risk their cash, why should an investor?

There’s nothing wrong with wanting to stay in a comfortable job – or to create one for yourself by running your own business. Just don’t confuse that with a business that can scale and make a significant amount of money – more than just a living.

Australia is on the cusp of a business revolution. We are a nation of SME’s –we have the entrepreneurial bug. That was evident in the incredible number of entrepreneurs who applied to be part of the first season Shark Tank. We are also an inventive nation, with a great track record of innovation – from the Hills Hoist to wireless internet.

The world is now a smaller place, one where a digital idea can be born in Australia and go global immediately. To remain competitive as a nation and as business people, we need to target a global customer base.

The opportunities are enormous.

The only real obstacle in our path is our ‘no worries,’ culture. We have a great lifestyle in Australia, and that should be protected. But let’s not stay a sleepy hollow.

Maybe we need to get a little less comfortable.

Some of us need to seize the opportunity and give up our day jobs.

This article first appeared on Business Review Weekly. View the original here.