A Passing Note
A while back, I was working with a CEO who was fundraising from VCs other than Spark. He showed me the list of all the VCs he was talking to, and where they all were in the process. At the time, a few of the VCs had decided to say “no.” I asked this founder who said “no” the best and how did he/she say it? Because I don’t believe in kiss-and-telling, I’ll leave the name of the VC out (I will say it is a VC I respect), but the way the VC passed stuck with me, and I felt it’s worth sharing.
The VC essential said: “Thanks for your time, but we have other investments we are looking at now that we’re more interested in.” This paraphrase was worded more nicely and drawn out over a full paragraph, but this was the gist. There was no constructive feedback.
I looked at this note and initially was surprised the entrepreneur liked this note the best. The reasoning the entrepreneur gave me for his preference was: A) it was dead honest, B) it wasn’t made-up feedback and C) it was a prompt response.
(B) is the most interesting part to me. When a VC is in the business of saying “no” 99% of the time, coming up with a good reason to say “no” is often a half-truth. The “no” might simply translate to “I’m not interested” in reality, but then the VC will create constructive feedback in exchange for the entrepreneur taking the time to pitch. The feedback will be a half-truth because it might be a well-founded critique of the business’s biggest issue, but even if you did fix the business in according with the feedback, the VC would still be uninterested.
The entrepreneur’s reaction to this note continues to stick with me. I am struck by the simplicity of all sides of the outcome.