Founders Should Never Pay to Pitch
Finding good businesses is a VC’s lifeblood
I’m writing this in a Lyft on the way to judge a startup pitch competition, and I’m pissed. So pissed that I’m knowingly getting myself carsick because I want to get this out now.
Someone I know referred the person running this competition to me because they were expanding to Boston and needed VCs to judge it. Neither person told me in their intro emails that they were charging founders to pitch. Thus I agreed, because meeting founders and judging pitches is something I do all the time.
Then when I was getting ready for the event a couple of hours ago, I searched my email to remind myself of what I was supposed to do tonight. I saw that someone with the group running the event had sent me an email with a link to it, and that page listed prices for attendees. Here’s the kicker: they’re charging founders $200 to present to VCs for ten minutes.
There are so many things wrong with this that I don’t know where to start. And now I’m in this uncomfortable position where I’d have to bail on an event that I committed to going to right before it happens, knowing that founders paid with the expectation that investors would be there, versus associate my and Accomplice’s brand with a practice that is completely against my values.
I’m going, but I’m writing this on the way there and then directing people to it while I’m on stage. Awkward, but I feel like both the founders and I were mislead. I’m not going to call out this event or these people in this post because they’re probably startups themselves and I don’t want to wreck someone publicly without giving them the benefit of the doubt. I’m sure you can figure it out if you search, though.
What’s wrong with charging founders to pitch? First, it takes advantage of a group of people who traditionally don’t have a lot of resources. If you’re starting a company, you’re typically paying yourself a tiny salary (or nothing at all), eating the stereotypical startup ramen, and watching every dollar you spend. Not to mention that paying to pitch favors those founders who are already more well-off and disfavors those who aren’t wealthy, which tends to be underrepresented people who need funding more than ever.
If anything, investors should be the ones paying founders to hear them pitch because finding good businesses is our lifeblood. We depend on founders coming to us with their ideas. Sidenote that Unpitch in Boston does this and arose out of similar anger around an event that was charging founders to pitch VCs. Please support and check out Unpitch here.
Second, it puts investors in an untenable situation because founders have paid to pitch us, so we may feel extra pressure to spend more time. To be clear, none of the money the founders paid is going to me. It’s going to this group that’s running the event (one whose mission I still don’t entirely understand). But the fact that founders paid to present to us investors — $20 a minute, to be exact — adds a weird level of pressure.
Third, it’s extremely unlikely that this $200 to pitch will result in funding. VCs back less than 1% of the companies that pitch us. And in my experience, I’ve never had an investment come from a pitch event. Not once. The odds are overwhelmingly low that any deal will arise from this event, and yet the group organizers are preying on founders’ desperation to keep their companies up and running by giving them hope that they can pay to get in front of VCs who will then write them a check.
I’m still going to judge this event because I made a commitment and because founders expect investors to be there. But if you’re a founder or a VC and you see that an event is attempting to charge for this interaction, run or call them out on being wrong. Frankly, it means much more for a founder to reach us through an existing portfolio company, someone else we know, or even a cold (but thoughtful) email or tweet. And those are free.
If you were one of the people who paid to pitch at this event tonight, email Sarah(at)accomplice(dot)co and CC Liv(at)accomplice(dot)co and you can pitch me for free and Accomplice will refund your money.
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