#260 Investor's dilemma #2

Sweet Buzz - Scaling a Digital B2B Business With Dancho Dimkov

In this episode, I continue my discussion about investing and share a personal experience of trying to partner with a passionate team years ago. I invested in a recording studio, but quickly learned that passion alone isn’t enough. The people I worked with weren’t ready to take on the responsibility of being entrepreneurs, and the project fizzled out when I wasn’t around to push it forward. The lesson? Entrepreneurs need to have skin in the game, whether through time, effort, or capital, to truly succeed. The second big insight I share is about leverage. If I’m going to invest in a business, it needs to be in an industry where I have experience and knowledge—whether it’s SaaS, lead generation, or building communities. That way, I can add real value without having to learn everything from scratch. Investing in businesses that align with my expertise means I can maximize my contribution and ensure long-term success. Transcription: Hello everybody, it’s me again, still here in Yerevan, and I wanted to continue from the previous Investor’s Dilemma episode. Something new came to mind that I had to share. I’ve actually tried the approach of finding passionate people to join their businesses, and let me tell you, it didn’t work out as I had hoped. This goes back 20 years—well, maybe more like 15 years—when I was working in a corporation and making some good money. Some of my friends, who were entrepreneurs, would come to me with business ideas. I’d think, “Okay, I can gamble a little bit of money on this.” One idea that really caught my attention was from a friend who was a musician. He wanted to build a recording studio, and as a business guy, I did my homework. It seemed like a solid business idea. Beyond working with singers, the studio could offer services like voiceover recordings for commercials, mastering audio, and providing international audio engineering services through platforms like Upwork. It seemed promising, so I invested in the studio. But here’s the thing: I realized that not everyone is cut out to be an entrepreneur. The passion was there when I was around, but when I left, nothing happened. I quickly learned that even if you give people the money, resources, and the opportunity, some just aren’t ready to take action. It’s a skill set not everyone has, and they need more than just financial backing—they need real skin in the game. Looking back, I see that I could have approached it differently. Maybe I should have offered them more ownership to motivate them, or required them to put in some capital or effort. But the lesson I took from this is that if you’re going to join someone in their business, they need to already be making progress on their own. I’m no longer interested in investing in just ideas. I want to work with entrepreneurs who have already proven they’re serious about their venture. If they’ve made progress—whether it’s building an MVP, offering free trials, or developing an established community—that’s when I’ll get involved. The second big lesson was about leverage. If I’m going to invest, it needs to be in something I already know a lot about. I don’t want to spend time learning a whole new industry, like a restaurant or a golf course. I’ve built up expertise in sales, SaaS, lead generation, and building communities over the past decade. These are the industries where I have leverage—where I know the competitors, the tools, and the market inside and out. That’s where I should be putting my money.