Tips on How to Approach a VC
Posted on 11/07/16 by Natalie Monkou
The recent TechBreakfast event “Ask a VC DC,” held in Crystal City, was a great opportunity to bring together the D.C. region’s best investors and startups — providing a space for innovators to pitch and learn some basics about venture capital and angel investing.
We were there as well, and we learned about some best practices that are especially ideal for our entrepreneurs in Arlington looking for venture capital or angel investor funding. Here is a snapshot of the recommendations when pitching and seeking out capital.
Recommendations on How to Approach a VC
- When first meeting with an investor, come open to brainstorming solutions for growing your company - sometimes it involves money and other times it does not. Do not push a valuation at first.
- Cold emails are not as great as a warm introduction through an identifiable and trusted source. If you do send an email, reference someone that the individual you are trying to connect with knows. For example, who do you know that they know on LinkedIn?
- Be able to speak about your product, the market, and have a quantifiable number that shows how the product you are selling is an actual need in the market.
- Be able to answer this question: What's the size of the market that you are targeting initially?
- Show off your team of experts. Why are you and the other leaders on your team the people that the VC or angel investor should invest in?
- Know your competition. Where are competitors better in certain areas and how can you overcome that?
- People matter. How will you be able to recruitment a great team?
- Be clear about the ask.
Beware of the Red Flags
- Making the elevator pitch to a VC in one minute can be scary. However, failure to be clear and concise about the problem you are trying to solve will not make a great impression.
- Do not mistake confidence for arrogance. Remember, VCs work with founders for years. It’s a big problem if you don't like each other.
- Don't lie. As with all relationships, trust is a big component—this one is no different.
- Lack of passion and knowledge about your industry area are not attractive.
We know growing a startup can be challenging. If you are looking for more tips on how to grow your business, feel free to connect with us. As an added bonus, here is a link to the VCs that participated in this event. Happy researching!