Getting rejected sucks.
It doesn’t matter if it’s investor rejection, SBA loan rejection, or just sharing your idea with friends and family and getting negative feedback.
No one wants to be shut down, and when you have a business idea, you will likely encounter rejection about the idea or about the money you need for getting it going. However, there is a right way and a wrong way to handle rejection, and handling it right can actually open doors for you.
Handling Rejection with Grace Can Get Results
My client Paul was someone who initially reached out to me for pitch support. He was referred to me by someone who recently got my help for pitching to Kevin Harrington, and when we first spoke, he seemed downright angry that he was told to get professional help with pitching.
Paul first explained to me how experienced he was and how he had pitched at dozens of events, so he felt offended that anyone would imply he didn’t know how to pitch well.
When we dug deeper into his pitch approach and content, I completely agreed with him! He WAS great at pitching and had a super compelling business and message. However, when I asked about some of the feedback he received from investors, it became clear what the problem was: He could not handle investor rejection in a professional manner.
Any investor who seemed to question Paul’s ideas or projections was quickly met with hostility. Paul was defiant and closed-minded, not open to accepting any negative feedback and refusing to take “no” for an answer. He had, one by one, closed doors for himself within the investor community because he didn’t know how to correctly end a pitch that didn’t result in a deal.
I worked with Paul on a few key phrases and tactful ways to wrap a pitch that was clearly going nowhere. He followed my advice at his next pitching opportunity, where he (again) didn’t leave with an investor deal. A month later, one of those rejecting investors called Paul back. He told Paul that while he didn’t want to invest, he did have a friend who was interested, and because Paul handled the pitch so well, he was glad to make a personal referral to that other investor.
Had Paul used his old tactics, he likely would have never been trusted with that referral. However, because he left the door open and handled rejection like a seasoned business professional, he created an opportunity out of a rejection.
How to Handle a “No”
There are ways to respond to investor rejection and SBA loan rejection to your business idea, so you don’t leave a bad taste in people’s mouths.
You want people to think of you as professional, respectful, and self-confident.
If you are at a pitching event or are pitching to a potential partner or investor in any scenario, consider these three points:
- Say thanks for taking the time to listen to your idea.
- It’s over when it’s over — don’t oversell if they don’t seem interested.
- Leave materials behind so they can review them when you part ways (and include your contact information).
For the third one, this is a simple cover letter, one-page business plan, or executive summary. For an SBA banker, leave him or her just the executive summary page of your business plan, and ask them to please keep their ears open for anyone who might be able to invest. Bankers often get investors as clients, and you never know who they may be able to connect you with.
Sometimes, an initial rejection is not a closed door.
When people hear an idea, they need to mull it over and sleep on the concept. Rarely will a business idea be accepted by an investor or lender in one sitting. There is a vetting and evaluation process. Their thoughts on your business idea may veer towards “yes” and may teeter towards “no” a few times before it lands on one or the other.
Until you get funded, try to see everyone you pitch to as a potential partner, and treat them like an ally who can become educated on your idea with time — not like a person you need to sell or close right this instant.