Home Pitching To VCs? Make Sure To Do Your Homework

Pitching To VCs? Make Sure To Do Your Homework

As the new year gets underway, venture capital firms have returned to reviewing possible candidates for new investments. If your startup has a meeting with VCs coming up, be sure to do your homework and research the firm that you are pitching to before you show up without any prior knowledge of their past investments.

In a blog post yesterday, Grotech Ventures partner Don Rainey wrote about his Top 5 Rookie Mistakes in Pitching VCs and at the top of his list was not reviewing the firm’s portfolio. Rainey says while it’s not necessary to become an expert of their history, it is important to have a general knowledge of the kinds of companies the firm invests its money in.

“If I’ve had three companies in Internet Advertising, for example, you can probably skip explaining simple concepts related to it,” writes Rainey on his blog VC in DC. “If one lacks that awareness, it wastes time AND undermines credibility.”

Having a basic knowledge of a firm’s prior deals is not only good for learning about their habits, it also shows that you came prepared and are responsible to do what it takes to succeed. On another level, taking the time to learn about the people you are asking for money from is just a respectful thing to do and will save time for both parties.

Also on Rainey’s list was a more straightforward tip: don’t be late to your meeting. But a less obvious mistake he says startups often make is attempting to get the VCs to sign a non-disclosure agreement (NDA) – a topic we recently covered.

“Venture Capitalists don’t typically sign non-disclosure agreements,” he says. “Really, we don’t. Best not to ask.”

Photo by Flickr user scubasteveo.

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