After more than fifteen years evaluating investment opportunities, these are the qualities I look for — and the warning signs that make me walk away.
After more than fifteen years evaluating companies, I have reached a conclusion that is not original but is profoundly true: I invest in people. The numbers matter. The sector matters. The timing matters. But none of that can compensate for an entrepreneur who is not the right partner.
These are the qualities I look for. And those that make me walk away.
It is non-negotiable. I can work with an entrepreneur who cannot read a balance sheet, but I cannot work with one who lies to me. Integrity manifests in small things: how they treat their employees when they think nobody is watching, whether they acknowledge problems before you discover them, whether their word means something when there is no contract backing it up.
I have declined financially attractive deals because during the due diligence process I detected inconsistencies in the information provided. Not errors — inconsistencies. If someone conceals things before signing, they will conceal things after signing.
I want to sit with someone who takes pride in what they have created. Who knows their clients, who can name their employees, who can explain to me why their product is better without needing a PowerPoint presentation. That pride is not vanity — it is a sign that the company has soul, and companies with soul are the ones that generate sustainable value.
The best entrepreneurs I have worked with could spend hours telling me about a technical detail of their product or how they solved a problem for a client fifteen years ago. That passion is impossible to manufacture and extraordinarily valuable.
Every company has problems. Every single one. When an entrepreneur presents their company as though everything works perfectly, I worry. Either they do not know their own business or they are concealing information. Neither option is good.
The entrepreneurs who interest me most are those who say: “We have a problem here, we have not been able to solve it, and I believe a partner could help us.” That honesty is the foundation of a productive relationship.
I look for entrepreneurs who are realistic about where they are and ambitious about where they can go. I am not convinced by the one who lives in a fantasy world where everything is wonderful, nor by the chronic pessimist who sees only obstacles. I am convinced by the one who says: “We generate 25 million in revenue, our operating margin is 8%, and I believe that with investment in technology and expansion into the Portuguese market we can reach 50 million with 12% margins in five years. These are the risks.”
That is an entrepreneur I can work with. Feet on the ground and eyes on the horizon.
I do not look for entrepreneurs who agree with everything I propose. I look for entrepreneurs who listen, who consider perspectives different from their own, who are willing to change their mind when the arguments are better. But who also defend their position when they are convinced they are right.
The best investor-entrepreneur relationship is one in which there is constructive debate. If an entrepreneur accepts everything I say without questioning it, they probably lack the strength needed to lead. If they reject everything, they probably do not need a partner.
Over the years I have developed a fairly refined radar for detecting relationships that are not going to work. The clearest signals:
When the conversation is only about money. If the first discussion revolves exclusively around valuation, price, the multiple, without the entrepreneur telling me about their company, their team, or their vision, it is a bad sign. The financial transaction should be the consequence of a fit, not the starting point.
When problems are hidden. If during the process I discover that the information provided was incomplete or embellished, the conversation ends. Trust broken before the start does not get rebuilt.
When the plan is to sell and leave. I am looking for partners, not sellers. If an entrepreneur wants to collect and disappear, there are buyers for that. We need a transition period and, preferably, continuity of the founder in some role.
When the ego is bigger than the company. I have met brilliant entrepreneurs incapable of delegating a single decision. That works up to a certain size, but it is incompatible with the growth we aim to drive.
After more than one hundred and fifty investments, I can say that the ones that have worked best are those where, before talking numbers, I felt I was sitting across from someone I would share a coffee with even if there were no deal on the table. Investment is a long-term relationship. And like every relationship, it begins with the people.
Dirk Manuel Martens Jimenez Founder, Blue Mountain Capital
Founder of Blue Mountain
Over 15 years investing in Spanish companies with patient capital. Expert in business succession, corporate governance, and middle-market investment.
By Blue Mountain Capital
By Dirk Manuel Martens Jiménez
By Dirk Manuel Martens Jiménez
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