You walk into the meeting room, your palms are sweating, and you are trying your very best to keep your breathing inaudible. This is it- the chance to pitch your startup and win over that investment that is so crucial to making your dream a reality.
Your idea is great and you have the knowledge, experience, and tech to back it up. But what many investors go off of (though not many would admit it) is that first impression. That first meeting will leave a taste in the mouth of the VC that is impossible to shake, so you want it to be sweet as honey.
The multimillion-dollar question remains: what are the dos and don’ts for getting your first impression spot-on? I asked the F2 venture capital investment team what gets them excited in that initial meeting, and what can turn them off instantly.
DO: Know thy audience
Investors are not the only ones that ought to do their due diligence. When you are pitching your startup idea, not only should you know the ins and outs of your product and strategy, but you should come knowledgeable about the VC world, a world vital to your success.
As a member of the F2 investment team, Tal Zackon explains:
“One of the things that impress me the most in that first meeting is if founders understand the VC business. If they are asking how many funds we manage, what’s our reserve strategy, who led the rounds. This assures me that not only do they understand their business as a startup and the strategy of raising capital, but that they care enough to ask the right questions for their baby.”
DON’T: Be a bullshitter
When you are trying to win over investment for your young startup, that urge to embellish the facts is tempting. But one of the easiest ways to put off a VC from the get-go is by lying, something most investors can sniff out in an instant.
The managing partner at F2, Jonathan Saacks, emphasizes this point, giving an example of a startup that claims that their term sheet is ready in order to pressure a VC into a rushed agreement. All it takes is a few probes to uncover that no term sheet exists and with that, a lot of the motivation to invest disappears.
For VC’s to feel confident and comfortable investing in your startup a little schmoozing goes a long way. Do your homework, not just about your product, but about who you are talking to. Do you have mutual connections that could vouch for you? Do you know the history of the VC and who they have previously backed?
This is something emphasized by F2’s managing partner Barak Rabinowitz who describes the great impression made when the startup treats the VC “as people and not as a commodity”, he goes on to explain why personalization is so crucial:
“if a startup pitches their product like it’s a science project as if it’ll win on merits of their invention alone- we are put off. We are not investing in a product we are investing in a company.”
DON’T: Brush off questions
A point mentioned by several members of the investment team is the importance of how founders respond to questions. As Tal explains, “when a VC asks a question it’s for one of two reasons, either we are interested and want to know more, or we see a red flag and want clarification.”
In either of these circumstances, giving the questions weight and answering them directly is essential, it shows that you are knowledgeable about your product and open to coaching and critique when the times comes (and the time will come.)
DO: Be Confident
One of the most powerful first impressions for Maor Fridman, the investment tech expert, is the confidence of the CEO- both in themselves and in their startup. He emphasizes, “If the CEO comes to that first meeting unsure and noticeably unnerved with a clear lack of belief in themself, how can we believe in them?” Yet there is a fine line between confidence and cockiness that can make or break that initial meet and greet.
While the entrepreneurs ought to have enough confidence to carry their company, they also need to be able to hear advice and be coachable, which is why if a VC senses cockiness it’s a quick put off. Tal stresses:
“if a founder talks about himself for more than 30% of the meeting time, I am put off.”
DON’T: Talk over your teammates
Internal founder chemistry is crucial for a startup’s success, and it is what VC’s are looking out for at that first meeting. Are you connecting with your co-founders and presenting your product cohesively? Or are you talking over one another and each trying to be the alpha?
One thing that can and will put off a VC at that first meeting is a team that clashes with one another. How can one invest in a team that is falling apart before the journey has even begun?
First impressions are almost instinctual, and with VC’s meeting thousands of startups a year, it is worth knowing how to put your best foot forward and leave that lasting first impression. There are countless other factors that go into whether a VC decides to invest in your startup, so control what you can and make that first impression golden.