The best VC meetings are very dynamic, where both sides are riffing off of each other on strategy, business development and creative ideas. So, if you’re in a meeting with a venture capitalist who’s pushing on new areas, run with it!
So to get that first meeting with a venture capitalist, sometimes you have to go through a gatekeeper like a junior associate or principal. Don't be afraid to do that. In fact, make that person your champion. Eventually, the partner who makes the investment decision will turn to that individual and say, "What do you think?" If you turn that person off, you're likely to get a bad outcome. Find out maybe from the assistant who set up the meeting, or the partner themselves, who's going to be there, and what role they're there to play. A lot of times as part of their process, venture capitalists will bring in experts. Maybe it's an entrepreneur in residence, or a former CEO or entrepreneur that they've worked with before, who know your industry, and have expertise that they want to tap. So know who's in the room and know their background. Don't walk in and be surprised.
So in that meeting with the venture capitalist, don't downplay the risks.The most impressive entrepreneurs put the risks up front. They're ahead of me in thinking about the risks, and they lay out their plan for mitigating those risks. One of the most impressive entrepreneurs that we've backed is a gentleman named Dwight Merriman who's the cofounder of MongoDB and previously had been the cofounder of Double Click. When Dwight pitched us on Mongo in the very early days, he was very humble. He described the problems that he was having in trying to build the company and build the technology and get the first customers. And instead of telling us all the things that he had done, he was describing all the risks, all the issues, and trying to get our advice on how to deal with them going forward. That's what impressed us the most.
I think the best VC meetings are very dynamic where both sides are riffing off of each other on strategy, business development, creative ideas. And so if you're in a meeting with a venture capitalist who's pushing on new areas, asking you if you've thought of new things to do, new products to launch, run with it. Be creative. Brainstorm a little bit and show them that you've thought about those issues, or if you haven't, how you think about them. They're not trying to trip you up; they're just trying to creatively brainstorm with you and almost get a feel for what it would be like to be in the boardroom with you.
Many entrepreneurs come into the venture capital pitch meeting feeling like they need to press to impress. That's not the case at all. Don't exaggerate what you've done in the past, or what you're trying to do. A lot of entrepreneurs walk in and make big claims. Every entrepreneur that walks in my office shows me a hockey stick growth curve. So the real issue is, what's the credibility and the validation behind your claims? Whether it's people that you know in common, whether it's credible industry leaders that share your point of view, whether it's customers who have paid you for what you've done already. Always think about providing that validation and credibility to the entrepreneur in a sincere, authentic way.
We had one entrepreneur come into our office pitching us on his new company. And in describing his background, he took credit for a very successful venture, claimed he was a cofounder of the firm, and that he had meaningfully contributed to its value creation. Well, it turned out we knew the founders. We knew them well enough that after the meeting, we called them and asked them, and it wasn't as he said. He was not a cofounder, he was not a meaningful contributor, and many of the things that he said just were not true. Suffice it to say, he didn't get a second meeting.
At the end of the session, don't be afraid to ask them, "Is this something you're interested in? Is this something you want to spend more time on?" Like most human beings, venture capitalists don't like to say no, they don't like to turn people down to their face, but sometimes it's very appropriate to confront them in a nice way and just see if they really want to invest time in a follow up so that you're not wasting your time.
Bussgang, Jeffrey. 2010. Mastering the VC Game: A Venture Capital Insider Reveals How to Get from Start-up to IPO on Your Own Terms. New York: Penguin Group. Chapter 3 “The Pitch: The One in Three Hundred”.
Mark Suster. “The First VC Meeting (Post 1 of Many).” Both Sides of the Table. Blog Post. Jun 6 2009.
Jeff Bussgang. “The ABCs of Starting an Investor Pitch Meeting – Always Be Credible.” Seeing Both Sides. Blog Post. Oct 28 2010.
Fred Wilson. “The Role of Personal Chemistry in Investment Selection.” AVC. Blog Post. Oct 31 2013.
Questions for You
Who can I talk with before the initial meeting? What information might they be able to give me about how the meeting will go? Who will be in the room?
What questions do you have for a venture capitalist about your business that can keep your meeting dynamic?
What advice or guidance would you like from a venture capitalist?
What’s the credibility behind your pitch and company claims?
Questions for Your Team
What credibility or validation can you help build for investor pitch meetings?
Tools and Exercises
Video Yourself: Video yourself pitching before your meeting. Watch it. Be aware of any idiosyncrasies that bog down your presentation or any exaggerations that can be toned down or back up by facts. Include a Q&A portion with one of your co-founders or leadership team. You’ll want to see how you handle Q&A just as much as the actual pitch.