|As young entrepreneurs, we all meet angel investors and venture capital (VC) funds during different stages of our venture. As a business, we felt we had the fundamentals right from day one – we were adapting to changing markets, keeping costs under control, investing in the future, hiring the right people, etc. And after four years of being in the business, like most startups, we too reached a stage where external funding was required to scale the business and take us to the next level.
Thus started our journey into the world of strategic presentations, number crunching through complicated Excel sheets running into several tabs (we have about 40 versions as of now), market analysis and competition benchmarking.
No doubt that all of the above have given us deeper insights into the business, shaped us into what we are today (and we got more convinced about our vision), but it is the VC interactions that have been the most interesting. To date, we must
have met over 70 VCs and had at least three times that many meetings. While there are several articles that talk about how to address typical VC queries, this is not one of them. It is in fact to tell you about the different ways in which VCs say ‘no’ to a proposal.
(This is definitely not to undermine the assessment process of investors, but a light note on how we perceive it)
Here are the weird nos that we have received from different VCs to date:
The quickies: These are the real nice ones, who do not want to waste much of their time and so quickly respond with a ‘no’ or ‘share more details within a week’. These are the easiest group of people to work with as they don’t suck too much of your bandwidth. Their ‘no’ is pretty straight forward, ‘this is not our domain, not our size and not our stage’.
The number crunchers: These are the fancy ones with at least two associates in their teams who can’t get enough of the data. They dig into every cell and every formula of your Excel sheets till you start doubting yourself. The average rate is around three Excel sheets a week for about a month. By then, we don’t recognise the first version ourselves! Sadly, no amount of Excel sheets managed to get us a ‘yes’. Their ‘no’ typically means ‘let’s wait for more data points’ or ‘let’s observe this for some more time’.
The ones who keep us guessing: These are the ones who simply don’t respond till you follow up. No matter how long it takes or how many meeting you have had, they just don’t initiate a call or a meeting. The ball is always in their court. There is nothing like a proper ‘no’ in this case. We simply get distracted with our actual business and stop following up.
The round Robin: These are the ones who make you meet almost everyone in their organisation. With so many meetings, you have become a familiar face to almost everyone in their organisation including the peon and the ‘chai wallah’. Their receptionist can recognise you now, their canteen staff know your preference of tea or coffee, and you almost feel at home. You begin to wonder if they are simply passing you around till they find someone in their team who takes the onus of saying ‘no’. Someone eventually does.
The nice ones: They never say no. They meet you at every request, respond to every mail, provide patient feedback and it’s a long courtship till we outgrow it.
(Adiga is the co-founder and COO of PK Online Ventures Pvt Ltd, a digital media company focused on multi-screen video and advertising market in India. As told to our special correspondent Sainul K Abudheen)