
Ask HN: Meeting with VCs tomorrow, what tips should I know? - code177
Heading down to SF tomorrow for 3 days of VC meetings. Never done this before - what are some little known tips from seasoned entrepreneurs that I should know?
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dshankar
Since you're meeting VCs, I will assume you're raising money.

1.) Properly communicate how much money you are raising and why. Understand
how much money they normally invest in a startup (don't ask for $5k from
someone that normally invests $100k). Figure out how much money you need to
operate for 12-18 months or more. This should be primarily based on expected
team size & team growth. $10k per head per month is a good estimate (on the
low end). A team of six needs approximately $750k for a year.

2.) Focus on the team if you're seed stage

3.) Have a prototype of what you're building

4.) Understand your market well

~~~
cperciva
_don't ask for $5k from someone that normally invests $100k_

Are there VCs which go as small as $100k? (Honest question here -- all I
typically see announced is the sizes of _rounds_ and I don't know how large or
small the individual funders in those rounds are.)

~~~
mayop100
Short answer - no. Some will participate in seed rounds if they intend to
follow up in a series A. This is rare though, and $100k even at the seed stage
is tiny for a VC.

~~~
idanb
Lots of large VCs will invest as little as $100K to both get in for the next
round as well as provide the team with resources they may need that are non-
monetary, some will even take on advisory roles.

Investing isn't about the amount at the seed stage. An investor at the seed
stage gets a whole lot more equity for their buck earlier on, so they should
provide value over that of what the money will get you.

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joshu
I could probably write a book on this. I've been pitched a few hundred times,
invested as an angel ~50+ times, and raised twice (so far.)

If your product speaks for itself, none of the advice here matters. You'll get
multiple offers to play off each other.

A great lawyer will help you navigate this. I can recommend several if needed.

Try to pitch the weaker fit and less interesting VCs first. This will let you
get your patter down, make the strange questions unsurprising, etc.

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mathattack
Not seasoned, but, any time I ask someone for money, I try to...

1) Put myself in their shoes, and talk in their terms.

2) Understand their niche. (Seed? Early Stage? Late stage? Software? Hardware?
Energy?)

3) Be authentic. The money comes with strings based on what you promise. If
you lie about your project, product or person, you will have to keep it up
indefinitely, and that's a recipe for failure.

4) Respect their time. Be assertive without being aggressive.

Break a leg!

~~~
code177
Great advice, thanks!

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jerryji
Have you read the book "Venture Deals" [1] by Foundry Group VCs? If not, grab
a copy now and read through the first few chapters.

[1] [http://www.amazon.com/Venture-Deals-Smarter-Lawyer-
Capitalis...](http://www.amazon.com/Venture-Deals-Smarter-Lawyer-
Capitalist/dp/0470929820)

------
vm
I invest at a cross-stage VC fund with a several $B under management. I want
to back someone who knows everything about his/her market. Those are the
people who deliver brilliant product+market fit and continue to innovate. If
you already have product+market fit, then highlight the traction (lord only
knows how hard you worked to get it, show it off) and discuss scalability.

Talk in specifics. “we’ll grow by scaling campaigns that we ran which gave us
a CAC of $X and which cohorts monetized at $Y per month” is obviously better
than “we plan to get new users by advertising on [FB, Google, Flurry, Admob,
retargeting…]”.

More important than VC funding is to be hell-bent on your company’s success.
Do whatever you can (ethically of course) to make your company succeed. The
entrepreneurs that can raise capital easily have already created wonderful
things on few resources then find investors flocking to them to help them
scale. Travis at Uber and Omar at Admob come to mind as some of the best.

Lastly, investors are walking rolodexes. Ask for names and connections to
people who can help. If your business is not a fit for my firm, ask about
which investors might be a good fit.

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bluethunder
1\. Believe that you DON'T need the funding to build a big business. The
belief will help you ACT like you don't.

2\. The wrong way to look at these meetings is as an opportunity for you to
pitch for money to a VC.

3\. The right way to look at these meetings is as an opportunity for a VC to
pitch for a startup which will make him lots of money (see Rule no.1)

4\. Almost all funding decisions will get made within the first 15 minutes of
your meeting - this will be apparent in hindsight but you will get better at
this over time. The trick is to say 'Next' when they so 'No' without wasting
too much time.

5\. For the best results establish your credentials before meeting the VC -
probably by having a strong reference vouch for you/your work before the
meeting. (Note: Not all 'contacts' are 'references' and you will need to
discriminate to make this work)

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drumdance
Ask for a definite yes or no. Many VCs will say "maybe" when they really mean
no. Don't waste your time chasing maybes except perhaps to put them on an
email list that you send investor updates to.

~~~
jpdoctor
I've never heard an actual "no". No VC wants to be known as the guy who turned
down Google (eg.)

~~~
rgrieselhuber
This is true. Usually they will say "I'm interested" which means you can move
to the next stage or "I think it's interesting" which probably means "no."

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rms
It's probably to late to learn how to cultivate it if you don't already have
it, but VCs love rationally exuberant hypomania. See Bill Nguyen, as an
example. <http://www.fastcompany.com/magazine/160/bill-nguyen-startups>

But with the caveat of mathattack's advice to be authentic -- but if authentic
you is really excited about how your company is absolutely going to profoundly
change the world and eventually IPO, then roll with it.

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DanielRibeiro
From pg's (using the sidebar[1], so that you can easily skim the contents):
<http://paulgrahamsidebar.heroku.com/investors.html>

Venture hacks also made some nice points:
<http://www.slideshare.net/venturehacks/presentation-hacks>

[1] <https://github.com/danielribeiro/PaulGrahamSideBar>

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dmk23
I do not mean to discourage you, but the fact that you are posting here a day
before your trip means you are already at a disadvantage.

The key to maximizing your chances in these meetings is preparation. Your
story, your pitch, your funding request, your specific hooks for THE specific
firm/partner and your strategy for setting the stage for negotiating the deal
you can live with (should they want it at all).

Since you are apparently going in less than 100% prepared, I highly recommend
soft-pedaling the actual _pitch_. Last thing any investor wants is to be
stalked by someone who they do not believe is ready for funding, but is asking
for their money. If you do not have 100% bulletproof answers to all the
questions raised in the comments here I would categorize you as "not ready"
and recommend to use the following Plan B.

Instead of pitching and setting a hard marker (e.g. we are raising $X by month
Y), say that you are simply focusing on your business (product development /
sales) and is just starting to "explore the possibility" of raising funding
and "open to advice" on the best way to approach it. This would put any VC at
ease, you'll be able to present your story and if they feel it to be
compelling enough, they would want to follow up, buying you more time to
prepare. If they are not interested, nothing is lost because you have not been
"pitching" but merely "asking for advice". You'll be able to re-approach them
at a later time saying you are "finally ready".

Above all try to go in confident and relaxed. Be sure to look genuinely
interested when "asking for feedback", because chances are you could put it to
good use if they turn you down. Do not forget to ask for introductions too:
"who do you think we should talk to about this".

If you do not get any real interest, remember nothing is lost. Just focus on
your product / business and try funding when you have a stronger hand to play.

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wtvanhest
I worked for an Angel Investment Group for 2 years and went to VCIC
internationals. _I have never raised money myself at the VC level_

The 3 things you absolutely need to do at a minimum are: 1) State the problem
you are solving 2) State how you are going to solve it (If there are 2 sides
of the market, say "I know there are two sides of this market, here is how we
solve group A's problem, here is how we solve group B's problem, all by
allowing them to interact in the following way) 3) Be very specific about the
amount you are asking and have estimates on what things will cost. Be sure
that the amount you are asking for is enough to execute. (dshankar sounds like
he knows what he is talking about also).

* If it were me, I would spend the time getting comparable transactions that are close to your imagined exit so you can show how big your market really is (but I don't know if this is actually valid advice)

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hsuresh
Not sure if you have enough time, but you may want to check this out ->
[http://hackersandfounders.tv/T7F/naval-ravikant-hack-your-
fu...](http://hackersandfounders.tv/T7F/naval-ravikant-hack-your-funding/) I
saw this video a couple of days back and found it to be quite insightful.

------
Macsenour
In these situations I tend to remember the advice from the Dallas Cowboys old
coach Tom Landry, I believe it went something like this: "When you score a
touchdown, don't do a big celebration. Act like this is what you expected to
happen, and you've been here before so it's no big deal".

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swalkergibson
Is this a first meeting? The partner meeting? It seems to me that your
interaction with the VC's will vary based on how far along you are in your
relationship.

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andrewhillman
Don't pretend you know everything.

Get your pitch down and be concise.

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dollar
I will tell you like it really is.

1\. Say what your product does and why its going to be major in a single
sentence within the first 10 seconds of your presentation. With VCs you need
to pitch the problem or the opportunity, they do not give a crap about your
secret sauce until they understand they are dealing with a big opportunity.
Secret sauce is a second order problem. You have exactly 20 seconds to get
their attention before you meet he most arrogant, inattentive, distracted
person you have ever encountered.

2\. If 20 seconds have elapsed, take a look at your VC. If they are sitting up
straight, or leaning on the table attentive, you have them - now GO. Your
presentation should be no more than 10 slides, but preferably less than that.
Your slides should be pictorial with as few words as possible. Words are your
worst enemy, they remind the VC of competitors, portfolio companies, analyst
reports, VC gossip, and other factors. Words turn into questions that
interrupt the flow of your pitch. If your VC is distracted, looking at their
phone, typing away on their iPad, move along quickly because this probably is
not going to pan out. If someone in the room is still not paying attention,
walk over and stand behind them while you continue to talk. That one works
every time.

3\. Never, ever, yield control of the pitch, you must maintain the flow of the
conversation at all times. YOU are giving the presentation and THEY are your
audience. Let a VC start talking and they will never fucking stop, and 20
minutes later you will be out of time and they will forget who you were and
what you were talking about. Do not let your VC start telling you how it is,
YOU tell THEM how it fucking is, get them to shut their mouth for 2 fucking
seconds. This does not mean be rude, this means come fully prepared to ambush
your VC when they mean to abush you. Know your competitors, know their
products, know their customers, know their strengths, know their weaknesses.
Be able to explain quickly and succinctly why your product or solution is
going to own a particular market segment. Know your segment, love your
segment, explain your segment at length.

4\. Never, ever follow up. Its a complete waste of your time, and it makes you
seem like you really need them. If a VC is interested you will know when they
call you with next steps. Do not send them an email, do not call them, do not
singing telegram them. Nothing. Go completely link dead. If your VC wants your
slides, its up to you, but you don't have to give them anything. Speaking from
experience, VCs share these slides with their portfolio companies in addition
to their partners, and if its helping their portfolio its probably hurting
you. Either way you are giving away your property for free, so I suggest you
do not do that. If they want your property, they can cut you a term sheet and
the check to go with it.

5\. Meet with exactly 3 VCs a week. If you have not heard from a VC in 2 days,
drop them and add a fresh VC. Never tell a VC the name of another VC you have
met with, its none of their business, and its a HUGE disadvantage for you. VCs
all know each other, and if they think someone smarter than them passed on
your deal, they are going to pass too. Similarly, if they think someone
smarter than them is interested, they are going to call that someone and try
to do talk their way into the deal. If and when your VC hands you a term
sheet, THEN you can disclose who else you are willing to bring to the table.
Use your judgement to gauge VC seriousness.

And that is the way it really is. My advice to you is this: If there is a way,
any remote way, that you can build and launch your product or service without
raising venture capital, do it. Work a job if you have to, work two jobs if
you have to. The VC equation is highly skewed to favor the investor, but you
are the person that has to do all of the work, you are the person that is
really invested in the business. To make matters worse, once you accept that
term sheet, your investment in your own business becomes subject to the whim
of your investors. You may not understand this now, but you will understand it
when you go to raise Series B, Series C, Series D, and find yourself with just
3% of your own company because it took more money than you ever dreamed. VCs
want, no, demand, that you spend their money. Try telling a VC that you are
going to take $3.5M in Series A and stretch it over 3 years as you iterate.
Hell, try telling a VC these days that you want just $3.5M instead of $10M.

Good luck.

~~~
joshu
series As are typically smaller than that these days...

#5 doesn't sound exactly right; you want to generate heat around your deal and
this means bringing multiple parties to the table at the same time.

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chris_dcosta
How did it go?

