Let\u2019s say you walked out of the pitch meeting feeling uncertain about whether your investors want to fund your idea. Later you get the email or phone call\u2014they\u2019re not interested. What\u2019s the best way to proceed?<\/p>\n
\u201cAs an entrepreneur, one of the smartest things to do is when meeting an investor you\u2019re not going to work with\u2014either because you\u2019re not right for them or they\u2019re not right for you\u2014is to understand their objections and concerns,\u201d says Josh Hannah, venture capitalist at Matrix Partners in Silicon Valley.<\/p>\n
The whole point of meeting with an investor, especially if it\u2019s your first time, is to learn how to ask someone for a lot of money. Understand that what investors want to ascertain is how they can partner with your company and help you achieve your goals.<\/p>\n
Negotiations work best when you have built a good working relationship with the investor. If you walk away with nothing else from the negotiation except for the experience of promoting yourself and your business, then that\u2019s more than enough to prepare you for your next pitch meeting.<\/p>\n
\u201cThe whole thing starts with building a relationship and getting to know people,\u201d says venture capitalist Charlie O\u2019Donnell of Brooklyn Bridge Ventures. \u201cThe process of getting funding is not nearly as formal as pitch events and contests. It starts with having a conversation with someone you think would be knowledgeable about the business idea you\u2019re after and who could give you initial thoughts. As an investor, that\u2019s where I want the conversation to start.\u201d<\/p>\n
Rejection isn\u2019t the end of the long road to fundraising. In fact, one serial entrepreneur says that rejection was the best thing that ever happened to him because it helped him refine his ideas.<\/p>\n
\u201cI\u2019ve pitched about eight or nine times,\u201d says Scott Switzer, co-founder of Authenticated Digital, an advertising tech company. \u201cThe first investor I pitched to, who was someone I knew, basically was an outright no. The second person, who had companies that competed with mine, wasn\u2019t an outright no, but he had a lot of questions.\u201d<\/p>\n
By the third investor meeting, Switzer had a completely different pitch. This time, the answer was an unqualified yes.<\/p>\n
\u201cTake as much feedback and advice from the person you\u2019re talking with,\u201d Switzer says. \u201cThese people spend so much time with companies like yours in the startup space, so it\u2019s good to get their advice even if you don\u2019t get their money.\u201d<\/p>\n
When Hannah turns away entrepreneurs, he said his approach has been to turn them down with a thoughtful and personal note that tries as much as possible to articulate reasons why he\u2019s passing on the deal.<\/p>\n
\u201cThe reason I decided that\u2019s the best approach is because being turned down is a humbling experience for anybody,\u201d Hannah says. \u201cIf I do it over email, it gives them a chance to process on their own instead of doing it live on the phone. If they want to follow up with questions, the door is open.\u201d<\/p>\n
Whether you\u2019re killing it at every pitch meeting or getting rejected, know that each conversation with investors gives you the opportunity to refine your presentation and build upon your big idea. Investors have heard it all. They\u2019ve had thousands of companies like yours say their idea is revolutionary, and that the market demand is colossal. And they\u2019ll ask you tough questions that will keep you on your toes and help you prepare for your next pitch. So take all the feedback, take nothing personally, and take everything to heart as you move onward and upward.<\/p>\n
Photo credit: Lauren Kallen<\/p>\n","protected":false},"excerpt":{"rendered":"
Let\u2019s say you walked out of the pitch meeting feeling uncertain about whether your investors want to fund your idea. Later you get the email or phone call\u2014they\u2019re not interested. What\u2019s the best way to proceed? \u201cAs an entrepreneur, one of the smartest things to do is when meeting an investor you\u2019re not going to […]<\/p>\n","protected":false},"author":917,"featured_media":16789,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[43902],"tags":[],"class_list":["post-16785","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-professional-development"],"acf":[],"yoast_head":"\n