Monday, July 30, 2012

Signs A VC Is Just Not That Into You

"It’s a classic single... scenario: you really like this guy, but he’s giving mixed messages. You make excuses..."(but) he’s just not that into you. 
Stop kidding yourself, let go and look for someone else who will be. After all, as Behrendt sensibly puts it, "if a (sane) guy really likes you, there ain’t nothing that’s going to get in his way."
Publisher Weekly Review of "He's Just Not That Into You".
So you are in the midst of raising your series A.  You have done a great job of running a series A process - you have 10 or so firms you are talking to and need to decide who to drop from the mix and who to focus on.

Many venture firms will take a long time to get to a "no" with you.  While I have seen some firms got to a really fast "no", others will drag their feet.  It is just like in dating, some people are obviously into you, some clearly not.  But it is the ambiguous people who are the killer (and unfortunately, often the majority of VCs).  Here are some signs a VC just isn't that into you.

SIGNS A VC IS NOT INTERESTED
If you see these signs, you may want to drop the VC from consideration and not waste precious cycles chasing them down:
  • Doest not suggest next steps at the end of your meeting.
    • A VC who is interested in your company will usually define specific next steps at the end of the meeting.  E.g. "Why don't I get you together with 2-3 of my other partners later this week?" or "I will follow up with you quickly by Wednesday and we can discuss the data I need and next steps".
    • An uninterested VC will not suggest anything tangible to happen but will talk more in generalities.  E.g. "We should definitely keep in touch on this - I love you guys and your model".  This is a no, even though it sounds sort of like a yes.  Vague, positive-sounding generalities from VCs are almost always nos.
  • Makes endless data requests, without any in-person follow up set up.
    • The most ambiguous situation is the data request without any further in person meetings.  In some cases, this is a legitimate request so the VC can quote data to get their partners interested in investing in your company.  Unfortunately, it may often be a way for a VC to learn off of your experiences without any real interest on her part in your company.  Beware multiple data requests without any future meetings or clear next steps defined!!!  If this happens, you should stop sending inside information to this troll and move on.
  • Only has you deal with a junior associate.
    • Some firms use associates to screen their deals before a partner meets with your company.   If you can get to a partner directly from day one, you should.  If you are passed on to an associate and never hear from a partner again after meeting with the associate, the VC just isn't that into you.
  • Is not responsive to your emails
    • If a VC is into you she will prioritize your emails for reply.  This means you should hear back on many emails within the same day, and the rest of the emails within at worst about a week if they are e.g. travelling.  If it takes a VC more then a week to reply to most of your emails, she just isn't that into you.
  • Does not try to sell you on her firm.
    • If the VC does not spend the last 5 minutes trying to sell you on her firm, or offer introductions or help, she may not be that into you.
Any other signs a VC is not into you?  Let me know in the comments.

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