Maximising productivity in venture capital

Brad Feld posted a couple of days ago about Saying No In Less Than 60 Seconds in which he talks about the 10-50 times a day he has to say no to deals and meeting requests, and that as a result he has to do so quickly.

As Brad describes it there are a couple of things wrapped up in here, firstly his goal of being accessible to everyone that reaches out to him, which means both making himself contactable and responding to contacts, and the second is a time management point.  The goal is laudable and the time management is a practical necessity.

Turning to myself, I have a similar goal of having contact with as many interesting people as possible.  This is inevitably a time consuming process and as such competes for my time with my portfolio, the internal operations of our partnership, deals I am pursuing, and last, but by no means least, my family.  Unsurprisingly there is never enough time to go around and at any given point I am most likely feeling guilty about neglecting one of these constituencies, right now it is my portfolio where in the last week I have had two senior execs remark that they haven’t seen much of me lately.

My point in all of this is that for VCs optimising the use of their time is a big deal, as any extra that can be squeezed out can be profitably put to use.  Brad’s focus in the post above is minimising the time to say ‘no’, while still doing it well, and in this previous post he talked about how he likes to keep meetings short (often less than 30mins).  That resonated with me, as when I look at my working life and try to figure out where I can find time to meet with more entrepreneurs and spend more time thinking about our investments the obvious place to go is reducing the time I spend with companies once it becomes clear that we aren’t going to come to a deal.

US VCs have always been better at this than we are in Europe.  The culture of the 45 minute meeting is well established over there, but over here the custom is for meetings to last an hour or more.  Moreover, it is sometimes the case that people perceive it as rude, or some kind of sleight, or comment on their business if a meeting is shorter rather than longer.  I have had cases of more arrogant entrepreneurs wanting to schedule 90mins or 120mins for the first meeting.

In order to create time to see more companies I have been thinking about reducing the length of first meetings to 45 minutes.  I think that is enough for both sides to figure out whether we want to move forward together, but I’d be interested to know what you think.  From the entrepreneur side is 45 mins enough?, is it rude to schedule meetings this short?, and any other thoughts.

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  • I think short meetings are great. The sooner a meeting gets to yes/no the better.

  • Assuming that the VC has a chance to take a look at some decks/docs beforehand, I think it should be enough. Maybe its my American educational upbringing speaking, but that's what I would expect normally anyway. The rest of the time is just fluff, ice breaking, handshakes and extra slides that could be pushed to the back of the deck if time was limited. There is a reason they have elevator pitch contests in b-schools… Its a bit strict, but it would push me to prepare and be crisper (albeit raising the stress level a bit)

  • suthakamal

    45 mns is more than enough to get an understanding of the space, business, team, and their thought process. Plenty of time to decide if you want to schedule another meeting, or drag this one on longer.

  • hey nic. If you can get 45 minutes “market” then I’m forever in your debt.

  • I also think 45 minutes is plenty.

    One thing that might cut down on the fat in presentations is if investors were a bit more up front about where they fit on the things-I-care-about spectrum. If web pages were a guide, every VC on the planet is looking for “excellent founding teams in global markets with high growth potential”. But some investors are more interested in seeing you've done your homework and have reverse engineered some 5 year projections; others would just assume do without the hand-waving. Some are more interested in the individual backgrounds of the founders, others just go on a combination of the vibe they get from them and what they've accomplished so far. Some investors get excited seeing a product; others just want to know you've got customers that will vouch for you.

  • I think 45 minutes is a solid amount of time to gauge how the relationship & product proposed for investment would work. Quite honestly, you'll likely know in those first 20 minutes anyway.

  • HH

    Couldn't agree more. I should imagine in most cases you know within 15 minutes if you want to spend another 30 minutes on it.

    On the subject of saying 'no' – personally I love people that say no, and quickly, in all areas of business. People (particularly those in middling positions in larger companies in my experience) for whom 'no' is a dirty word and who would much rather make non-committal utterances like 'very interesting' etc. are a major bugbear of mine. They'll do this for months and then just stop returning calls/emails, as if that's somehow better than a 'no' would have been. A very curious mix of misguided politeness, incredible rudeness and downright cowardice, and a huge waste of everyone's time. Join my campaign to stamp this out, by telling people 'no' as soon as possible in any potential business relationship!

  • Couldn't agree more Harry. It does take courage to say 'no' quickly though

  • I don't understand the reasoning for the hour-long standard for meetings. (And hate that most calendar programs default to it.) 20 minutes should give you a decent feel for the team, the market, the opportunity, etc. Anything past 30 is being polite, and past 40 is being generous.

    (This is for a first meeting. After that, it's all up to you!)

  • 45 min for the first meeting “to here the idea and meet the team” is plenty. Also few ideas comes to mind when thinking about this.

    1. Agenda! – I think everyone funder should have “standardized” 1st. meeting agenda listed on their website and/or send via email along with the meeting confirmation. This agenda would list the expectations for the meeting from the funders point of view. This is the only way to make sure both parties come prepared. Maybe something like this:

    – handshake, (name) introductions, business cards, small talk 5-10 min.
    – pitch 15 min
    – Q&A and talks 15 min
    – No or yes for next steps 5min
    – next steps talks 15 min

    So no takes 45 min and if continued can be fitted in hour.

    if when its structured this way (like in a events are), should be good results.

    2. As much as “getting to know each others” and making sure both sides are a basics match for what they are looking for, can be done online/before hand, will speed things up even more.

  • Thanks Valto, some good thinking here

  • Thanks for all the comments people, and a unanimous view. 45 minute first meetings it is from now on, and I will do my bit by being clear on the agenda.

  • ed

    I've been reading your posts for some time and have gotten a lot from them. Thanks.

    I'm in the middle of launching a business (US based) and am out pitching to angels and VCs. It has always been my goal to keep my pitch (intro, slide deck and demo) to 30 minutes. I realize that during this 30 minutes, I need to leave time for questions as well. I've done this not because I'm afraid of loosing their attention, as some suggest, but out of respect for their time. If they're interested in the story, which so far, most have been, we set a time for another meeting.

    30 minutes is plenty of time to get ones most important aspects of the concept delivered, answer questions and allow the person or persons you're presenting to get some level of comfort with who you are.

    If its not, there is likely a “focus” issue on the message. If people feel that one only alotting 30 minutes is “rude”, then they probably don't have thick enough skin for the wild ride they're about to embark on….

    Again, thanks for you blog, these have been a lot of help and great info!

  • No problem. Thank Elando

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