Alexander Rupert of EarlyBird VC recently posted an analysis advising VCs about the potential mistakes they might make in their first year at the job. With a few tweaks, those lessons can serve as pointers to anyone who might find themselves sitting across from a newbie venture capitalist.
1: Avoid Group Thinkers
VCs can be tempted to jump on a trend simply because it’s a trend. That might seem great at first, if your topic is trending. Take augmented reality games, for instance. They’ll be hot for the next six months, thanks to Pokemon Go. But when these VCs don’t see similar results from your startup, they won’t be understanding. Think you can boost your value by $20M and become more popular than Sony, like Nintendo did? Yeahhh no.
2: Can They See Past Your Pitch Deck?
Rupert, to newbie VCs: Check to see if the VC is willing and able to ask questions beyond just the facts in your pitch deck. Although, make sure that your deck is coherent, too. That can’t hurt.
3: Are They Focused on Your Specific Industry?
VCs can’t add value if they don’t know what they’re talking about, and the broader an industry they try to throw that capital around within, the less they’ll know. Here, Rupert extends advice to the founders:
4: Are They Committed Beyond Mere Investment?
Will your first VC “work his ass off to make his portfolios become a success story”?
5: Are They Empathetic?
Venture capitalists are investors and supporters. In order to be supporting, they’ll need to be able to see things from your perspective. They don’t need to agree with you, of course, but even surface-level niceties like arriving at meetings on time will make a difference.
