Being an old guy/gal you figure out it is sometimes better to learn from others who have seen a lot and they have figured out a better way to do things. One example that just came up is engaging the VC community to go to market. For some engaging VCs is a conclusion so they are looking for the best way to engage VCs and get money.
How to ace the VC pitch
Image Credit: Aspen Photo/ShutterstockMany entrepreneurs, having wrapped their passion and intellect around their “next big thing,” can’t wait to hit the bricks and share their insights and enthusiasm with waiting investors, convinced that the check writers will “get it” and willingly part with their investment dollars. Unfortunately – and, in some ways, fortunately – the fundraising process is complex and requires focused preparation. Entrepreneurs who prepare carefully will be in a much stronger position, both to articulate their plans well and to execute on those plans when they secure investment capital.
I just talked to a friend about some ideas and he offered to help. What I liked is he has seen lots of start-ups and VCs operate, and he jumps to the point beyond acquiring funding. What does it take to be successful in a business.
Are you more worried about getting VC funding or whether your business will be successful. Sometimes the right answer is not to get VC funding. Consider this post on not getting VC funding.
I recently spoke on a panel in Santa Monica organized by my friend Jason Nazar, CEO of DocStoc, titled Startups Uncensored, Pitching Venture Capitalists. There were about 200 people in the audience.
Jason started by asking the audience how many of them were start-ups – 90% of the hands went up. He then asked for a show of hands of people who had already raised a round of Venture Capital – no hands. I guess you’re thinking, “duh, that’s why they came to the panel discussion.”
He next asked me specifically how many of these companies were likely to get VC funding (thanks, Jason) and I responded, “less than 5%,” to which I heard a big gasp. I responded that I thought this was a good thing – not something nasty. I contend that the vast majority of companies should never raise venture capital.
Raising venture capital is like adding rocket fuel to your business and for most businesses this a) isn’t warranted b) creates the wrong incentives and c) even if it is successful means that the founders don’t make enough personal money when the ultimate business is sold.
I repeat this advice on a very frequent basis to most entrepreneurs I meet and I find it usually surprises people. ”You’re a VC – aren’t you supposed to want to give us money?” No. I want you to create a successful company that will be fulfilling to you and your employees and will make life better, faster and easier for your customers.
