James Geshwiler, a local angel investor and a managing director of CommonAngels, has an interesting post in Mass High Tech entitled “Hey, Boston-area VCs, angels: Loosen up and connect with startups.” Besides the catchy title, James has a good point. I’ve debated this point with some of my venture capital friends, and I believe one of the most important roles of a VC – even if they are not invested in your company – is to help connect startups with others. Other startups, executives, potential customers, press and potential exits. This goes well beyond the whole recruiting-people-to-work-at-the-startup issue.
One of the things that somehow gets overlooked when the East Coast VC world is compared to the West Coast’s is how aggressively many of the most successful West Coast VCs promote their companies. And how aggressively the promote their companies to the RIGHT people – people who run companies that will one day acquire those startups, or buy their technology.
If you are a startup in the fund raising process, don’t be afraid to ask the venture capitalists for introductions. If you impress or interested the VC enough, they just might be able to connect you with the individual who will somehow help drive your company to success. It doesn’t hurt to ask!
September 9th, 2009 at 4:07 am
Good to know. Although, a scary task in that if the VC was unimpressed by the pitch, and you miss the signals, you might put him/her off by asking for a reference. I would hope that is not the case, but such is the paranoid mind of an entrepreneur seeking funding…
September 9th, 2009 at 6:03 pm
Important to understand that VCs turn down investments for a number of reasons. Just because they didn't invest, doesn't mean they won't help with a referral.
September 9th, 2009 at 6:08 pm
Well Shane, if you miffed the pitch he/she is probably already put off, so what is the harm in asking? And if you had a good pitch or connected with the VC then they won't be put off at all!