Knowing people is by far the most important part of business. Because my role is on the business development (sell) side, getting through the door is the first step. It’s impossible to raise funds if you can’t get in front of whoever is holding the checkbook. Because investors are constantly being bombarded with fund managers who are desperate to increase their AUM (assets under management), these investors usually respond warily and you are rarely successful unless you have an “in” (or if you have numbers like Steve Cohen). The “in” can be anything, from a common broker to a former co-worker or even a fellow student at whatever school you went to previously. Knowing someone who can put you in touch with whoever you’re trying to contact can be the difference between success and failure. See, if you can get someone who trusts you to put you in contact with your intended investor, that trust from your shared connection gets imputed onto your investor.
This principle is not constrained to just sales. For instance, in my role as a student, I am trying to land another internship for next summer and hopefully a job upon graduation. If I apply to a firm that has never heard of me, my resume will likely land in a pile full of students who look just like me. But, I have a connection, whether they are a Babson alumni, a former boss or a Babson professor that refers me directly, I will be set apart from the stack and my connection can emphasize what sets me apart. Because humans are social creatures, we are a lot more likely to respond positively to people that we know over random strangers (unless the person that we know also happens to be someone we dislike). Hence, I’ve learned to value every relationship that I form in this short period of working this summer.