For new entrepreneurs, raising money can be a daunting task. It’s unlike anything else you do in the business world. Even if you have experience running a department at a big company and have to make yearly budget requests, it’s not the same. Trying to convince strangers at an unrelated firm to give you hundreds of thousands or millions of dollars for your new idea and minimal track record is not a natural act.
To top it off, the dance you have to engage in with potential investors is just as unnatural. Investors are inundated with pitches, so very few are that interesting to them, but when one is interesting, they get really enamored by it.
For most entrepreneurs, this translates into lots of rejections and a small number of commitments. Given the sheer number of rejections that venture capitalists dole out, you’d think they would be better at it. Unfortunately, most are not. VCs are notorious for not saying “no” even though they have no intention of investing. It’s in their interest to keep you on the line as long as possible just in case you become an interesting company they get enamored with later on.
That means it’s easy to misread the signals a VC gives. Below are 15 different types of responses I’ve heard between my own fundraising efforts and companies I’ve advised. They range from being a direct form of “no” to a more insidious and subtle deflection that still means “no”.
Note: I’m normally not this cynical, but this article was fun to writePosted in: Animals Nature People