Dealing with a Junior VC (part 2)
This is the second of my posts on how to deal with a junior VC during your startup’s venture fund raising process. (My first post on interacting with a junior VC is here.) Obviously your most important goal when talking with a junior VC is to get to a partner. Just like it makes sense to know your customer when you are starting a business, it also makes sense to figure out what is motivating the junior VC with whom you are speaking.
Personally I get pumped up by cool technologies (that’s why I’ve got four computers; one is usually on the fritz because some alpha/beta program I’m goofing around with didn’t exactly work as promised.) I get inspired by experienced managers who are doing something risky and young founders who are figuring it out for the first time. I like to work with people who are doing something new and I enjoy helping get it going – working with entrepreneurs in our office is a ton of fun. There is nothing wrong with feeling the VC out for a minute and trying to develop a bit of a connection – it works in many sales situations and isn’t a bad idea when first interacting with VCs either.
There are also other underlying goals that your junior VC likely has that he or she likely won’t mention. I am trying to build a career in the venture business. This is freaking hard, and includes needing to impress my partners with my decision making. In other words, sometimes I need to say no to companies because I know that my partners will not be interested in a meeting or conversation. I don’t want to look like I’ve got bad judgement.
Another underlying pressure felt by many junior VCs is a strong need to make investments. A young VC who hasn’t closed any deals isn’t a VC – he’s just a guy who spends too much time on the phone and at breakfast meetings (or a gal, but you know what I mean.) This means I’m likely quite hopeful that your business is the diamond in the rough that will somehow make my career. Despite this hope, I also realize that most companies I speak with are not going to receive investments from my fund.
I also have a huge need to be time efficient. I’m certain this can be perceived as me being rude (I apologize, I know it is rude sometimes), but I just have too much going on. For example, this week I am conducting diligence calls and meetings for two different investment opportunities, helping build a financial model for a young startup and doing some business development work for an existing portfolio company. I’m also trying to reach the founders of a payment processing company, “Certapay,” but I can’t find even find them! These things are all really interesting projects, so I’m not complaining. I’m more suggesting that I may not be prepared to take a breath and focus on you (and the dozen or so other new leads I talk to this week) in the way that I should and that you deserve.
So, given those underlying goals and constraints, how can you maximize your chance of maximizing our interaction? What can you do to cut through the clutter and appeal to my desire to find the next big thing?
Looks like this is becoming a big post – I’ll put these prepartion tips in a third post to be released soon!