Intelligence
Naval: Number one — intelligence. You got to be smart. Do they have insight? Do they have specific knowledge? Have they thought about this problem deeply? It's not about the age. It's not how many years they've spent. It's how deep is their understanding of what they're trying to do.
Do they have specific knowledge? Have they thought deeply? It's not about age — it's depth.
Energy
Naval: Energy — because being a founder is brutally difficult. It takes a long time. In the long run, the people who succeed are just the ones who persevere.
If someone is doing this in some hesitating, preliminary way where they're looking for constant positive feedback, or they're easily thrown off course — they're not going to make it to the end.
Being a founder is brutally difficult. The people who succeed are just the ones who persevere.
Integrity
Naval: If someone has high intelligence and high energy but low integrity — what you've got is a hardworking, smart crook. Things are very dynamic, very fast-moving. If somebody wants to screw you over, they will find a way.
If I'm talking to a founder and they offer to do something slightly unfair to another shareholder or employee — in exchange for making me happy — that's a red flag. If they can do it to them, they can do it to me.
If they offer to do something unfair to someone else to make you happy — red flag. They'll do it to you too.
Do You Actually Like Them?
Naval: When you invest in somebody, you're signing up to spend the next decade of your life having them in your life. You have to genuinely like these people. If it's exhausting, if they're downers, if they're negative — no amount of money is worth it.
My favorite founders are the ones I learn from. Every time they call me for help, I jump on it — because walking around the block with them for an hour, I walk out much smarter.
My favorite founders are the ones I learn from. Every call, I walk out smarter.