An Entrepreneur’s Take on Working in Early Stage VC

A business strategist by day and designer by night, I’m passionate about helping others unlock their creative visions. I celebrate accomplishments with jewelry, which led to the genesis of my company Alva — your online personal jeweler.

After working on Alva for the past 1.5 years, I had the opportunity this fall to work at Chingona Ventures. From the first week, several of my assumptions around VC were proved wrong. It’s not as easy as I’d thought being on the other side 😉

Below are my thoughts captured as I took first meetings with founders and conducted diligence. I hope they’ll prove useful in your interactions with VCs.

1. Tell the VC what you do. What do you do? WHAT DO YOU DO? Say it (or better yet show it) clearly at the beginning of a meeting. The VC associate you’re talking to may have five back to back first meetings with founders that day. They may not have read your website. They may not know your industry. Go through your pitch with friends. What do they think you do? What confuses them in your pitch? Chances are that the associate will be confused too. The faster you’re able to convey what your company does, the more time you’ll have to dig into the important questions.

2. Help the VC help you. I used to assume that VC investors were all knowing. Some may be, but I certainly was not. Given that I worked at a generalist fund, I would go from talking to a blockchain company to a cleaning company to a women’s social network all in the span of one day. With all these different industries swirling around, I encourage you to start a meeting by asking if the investor would like to hear an overview. Tell them things that may be critical to the success of your company but obvious to only you. Have you done a detailed competitive analysis? Share it! Time can kill a deal. The more you’re able to help a VC understand your industry, the easier it will be for them to move forward.

3. Bring the energy. I know continuous pitching can be draining. As founders, we say the same thing repeatedly and face a ton of rejection. But each time you meet with an investor, that’s the first time they’re hearing it and they’re only going to be as excited as you are. Each investor is different. Give them a chance to love your company.

4. Be transparent. Do you have the contract signed with a potential sales lead? Do you have a term sheet from a lead VC? I know how hard it is to show traction at the start of a company and you may want to make things sound rosier than they are. Here’s the thing — the investor will dig until they get to the core of the question. If you don’t have any major contracts signed, that’s fine! Just answer directly. Trust is one of the biggest factors in early stage VC and if you take a dodgy stance from the start, you won’t get a chance to build trust later.

5. Get out of the inbound pile. At Chingona Ventures, we get 35+ cold inbounds from companies per week. I have about 30 seconds to scan your inbound request to see if I want to take a deeper look. I’m looking for your problem, solution, and traction. Tell it to me plain and simple. No transforming x, disrupting y. Again, WHAT DO YOU DO? And, most importantly, what traction do you have? Numbers work best here — revenue, number of customers, number of customers on a waitlist, customers in your pilot, contracts signed, etc. P.S. Your work doesn’t stop with the inbound form. Try to get in front of the VCs in creative ways — LinkedIn, Twitter, PR articles, etc.

6. Gather information from the VC. Not all VCs are created equal for your company. Ask if the VC has equity targets or valuation limits — are you on the same page for the deal economics? Get feedback on what they heard and how they think about your business. At the end of the call, ask questions like: Do you have any concerns? How would you pitch my company at your investment meeting? Use their feedback to update your pitch.

7. Sometimes it’s the VC and not you. Funds have a lot going on. They’re balancing portfolio construction, pace of investments, and general admin and upkeep. Sometimes it’s not the right time for an investment, but don’t get discouraged. They may be interested in the future, and it’s worth keeping in touch. What do you need to rekindle the flame? Strong traction turns heads.