The CEO of 500 Startups says all successful founders have these 2 traits in common

500 Startups CEO Christine Tsai

Christine Tsai has worked with hundreds of entrepreneurs since founding 500 Startups eight years ago, giving her some unique insights into what leads to success.
She said successful founders tend to have two traits: They listen to feedback, and they move quickly.
To succeed, prospective entrepreneurs also have to be aware of the difficulty of the task ahead, she said.

Christine Tsai has a lot of experience working with startups, and that has given her some pretty good insights into what makes entrepreneurs successful.

Tsai is the cofounder of 500 Startups, the famed Silicon Valley venture firm and startup accelerator. Since last August, she's also been its CEO, following the departure of Dave McClure, her fellow cofounder who left amid accusations of sexual harassment — accusations she has declined to discuss in much detail.

Launched in 2010, 500 Startups has helped incubate hundreds of companies and invested in more than 2,000 total, including Twilio, which went public in 2016. In that time, Tsai has gotten a close-up look at lots of startup founders and seen what works and what doesn't, as well as what it's like to be an entrepreneur.

Successful founders, she told Business Insider in an interview this week, tend to have two key traits: They're coachable, and they move fast.

Listening is one of the keys to success

Christine Tsai, right, with the team from online clothing stylist Bombfell Tsai said people have this image of the successful entrepreneur as someone like the former Apple CEO Steve Jobs — the "don't listen to anybody, I'm always right" type of founder.

But those types of founders usually aren't successful, she said.

"I feel like those people who are like that, they succeeded despite being that way, not because they were that way," she said.

That doesn't mean successful entrepreneurs need to be ultra-congenial or acquiesce to every suggestion, Tsai said. But they do need to be open to suggestions.

"They do listen," she said. "They do take the feedback from customers, from employees, from investors."

Moving fast is also crucial

Successful startup founders also move quickly, Tsai said, whether it's launching new products or putting new strategies in place — or learning from mistakes.

500 Startups meets frequently with the founders of companies in its portfolio to check in about how their companies are doing and how things like fundraising are going, she said.

"It's always a bad sign if they say they're going to do something and then a week later, two weeks later, they still haven't done it," she said.

Successful entrepreneurs have to be careful not to be rash or reckless, she said. But they also have to avoid stalling and overthinking things.

"It's a very fine balance, of course," Tsai said.

But founders who succeed have a very acute understanding that they have to move as quickly as possible.

"You have a very limited runway either in terms of time or cash," she said.

It's important to be clear-eyed about the task ahead

twilio ipo Tsai also offered some advice for prospective entrepreneurs: understand what you're getting into.

TV shows and news reports tend to romanticize the life of startup founders, particularly the super-successful ones. But founding and running a startup is usually anything but glamorous, she said.

Most startups fail. Many entrepreneurs are trading a stable, high-paying job for an uncertain, lonely, and stressful existence.

And the payoff — if there is any — usually comes only after years and years of hard work.

"It's really sucky ... It's really hard," she said. "I definitely do warn [entrepreneurs] about that."

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