The young founder-CEO was excited about the email he had just received. It was from an?apparently wealthy?NRI from Canada who wanted to invest in the CEO?s company. According to the email, the NRI had ?found? the company, thanks to the Internet, and had, in fact, done background work on it and was now ready to invest Rs 50 lakh for 10% of the company.

The CEO wanted to immediately respond with a ?Yes!? as he was in need of cash. He had to meet his employee payroll expenses in 10 days. He had no idea who this benefactor was. Searches on the Internet yielded no results. The NRI?s email said that he was going to be in town that week just for a day and wanted to close the deal. He had also emailed a copy of an agreement.

The CEO?s joy knew no bounds. He went for the meeting ready to return with a cheque for Rs 50 lakh. During the meeting, something did not seem right. Whenever any issue relating to his background, experience, and the reasons for his interest in the investment came up, the NRI provided less-than-satisfactory and vague answers.

The founder was not comfortable with this but the NRI sounded nice and sweet, and was ready to sign. The founder was desperate for money to pay his employees at the end of the month. In spite of knowing how much the cash infusion would have helped his company, the founder found it in him to say, ?No, thank you?, to the NRI at the end.

Another founder had been in conversation with a senior industry executive to join his startup as CEO. The dialogue had been going on for the last five months and everything seemed to be going well. Salary and stock options were being negotiated for the last 30 days. The executive wanted extreme clarity on issues of bonus, stock prices, taxation and reimbursements. He wanted every discussion in writing with legal opinions and financial implications. The founder was getting frustrated. Finally, after another round of discussions on the same topics, the founder said: ?No? to the industry executive.

Here he was, an entrepreneur with passion who was clear about where he wanted his company to be in next five years. He was willing to bring on board external talent to help achieve the company?s goals. He was willing to learn and make the changes necessary to become a professionally-run company. He was looking for experienced leaders who were also entrepreneurial in their thinking. Those who would help drive the change in the company, could deal with ambiguity and of course, the risk inherent in a young company. Not for someone with a big company mindset, expectations and approach. Today, this founder has found other experienced and entrepreneurial industry executives but it has not been easy.

Both the founders had learnt important lessons that other entrepreneurs will do well to keep in mind: if the chemistry is not right, then the arithmetic will never work. That is, if there?s no comfort between the players, then no amount of money can help keep the partnership alive.

Do not forsake long-term benefits for immediate gratification. While it is difficult to do, great entrepreneurs instinctively know the value of different kinds of trade-offs. Opportunistic moves that have the potential to be a drag on the company?s long-term goals should be unceremoniously dumped. The founder-CEO who declined the investment from the NRI went on to borrow money from friends and family to meet his payroll expenses. Today, he?s venture-capitalist backed and doing very well. Beware of a ?confirmation bias?. What do you think?

?The author is an advocate of entrepreneurship development. He?s involved with Nasscom, TiE, IIM-Bangalore, and Insead Business School in driving entrepreneurship. He can be reached at sanjay@jumpstartup.net. The views expressed here are his own