Bringing interview best practice to VC pitches

By September 27, 2012Venture Capital

Pitching a VC has a lot in common with interviewing for a job. It’s a conversation where the entrepreneur is trying to convince the VC that he or she will perform excellently in their roll as CEO of their company and the VC is trying to convince the entrepreneur that they will be great to work with. There are some big differences as well, most notably that as well as selling him or herself the entrepreneur is also pitching the idea behind their business, but the similarities are enough that learning from interview best practice will improve the pitches of most entrepreneurs.

This topic is on my mind because I’ve just read Most of what you know about interviews is wrong on Geeklist.

It’s a long list of points to remember when interviewing with good explanations of why each is important. There is nothing terribly revolutionary but it is comprehensive and worth a read if you are interviewing. Some of the list is relevant for VC pitches (slightly adapted):

  • Go to as many pitches as possible – pitch early and pitch often. Good VCs like to meet companies before their ideas are well formed and are skilled at spotting diamonds in the rough, so don’t be afraid of pitching early in the life of a company. I am often surprised at how much better entrepreneurs get at pitching their companies after a bit of practice.
  • Giving the correct answers to questions will get you funded: WRONG! – as in an interview VCs will be making subconscious judgements based on body language, tone of voice, facial expression and tone and pitch of voice. Most people can’t fake these, so the only option is to be genuine. We sometimes see entrepreneurs who look and sound tired whilst telling us they are excited to be taking over the world. They don’t get funded.
  • Deflecting a question by asking a question back will deflect the VC: WRONG! – this serves as a red flag that there is a subject the entrepreneur doesn’t want to talk about. Listen carefully and be careful of doing this accidentally.
  • Appearing cool and hiding your emotions will get you funded: WRONG! – VCs want to see and feel confidence and excitement from the entrepreneurs.
  • Being humble will get you funded: WRONG! – you need to sell yourself, focusing on what you’ve actually done and achieved particularly when that demonstrates entrepreneurial qualities like resilience, flair and ingenuity
  • Getting prepared for the questions will make you sound rehearsed: WRONG! – practice makes perfect.
  • A pitch is a formal meeting that takes place in the VCs office: WRONG! – VCs will form their assessment based on every contact they have with you
  • Calling the VC back will show that I’m desparate: WRONG! – unless you are one of a lucky few you will need to hustle your way to the top of your VCs priority list. That said, understand when silence means ‘no’. (I always try to say ‘no’ but many VCs simply stop returning calls.)
  • Once you make a mistake you die: WRONG! – there is no prefect pitch, and recovering well from a setback will impress
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  • I think ignoring someone rather than providing an answer/yes/no/maybe is a sign of weakness and lack of confidence/leadership skill.. applies to every person – be it VC, Angel, a HR Manager, CEO of a company etc.

    Nic – I found an intriguing fact – VC’s tend to reply – No or Maybe or later etc. That’s nice.
    However I found a much different atitude with Angels – at least the first time or “a few invetsments made” ones – so early investors. They are much more inclined to “loose the email” and not reply.
    Are they afraid to say No?
    Want to keep their options open?
    They can’t really say – come back at later stage as they are the first stage – they will look chicken ?

    What would be more interesting is how VC’s are actively looking for startups ?

  • Hi Sharky – I think that providing an answer is something everyone should aspire to. Some don’t because they are weak, others don’t because they are busy. Neither are good excuses, but they say different things about the perpetrator. I suspect that some angels don’t reply because they are worried that if they do it well and give a reason the startup will reply saying their reason is poor and they will end up in a difficult dialogue they don’t want to have. This problem is made worse because they don’t have the come back later excuse that many VCs use.