Comments on: Why Am I Passing?

By: Christian Sterner

Christian Sterner — Wed, 07 Jan 2009 01:55:52 +0000

Brad,

I didn't catch this until you just referenced it within a more recent post, but did want to toss some feedback your way. I would categorize my experience with you as great. You passed, but you passed quickly, genuinely, and introduced me to people that might not. What’s better is that you are willing to serve as a resource for founders even if you have no interest in backing them financially, which is why I ping you with questions every couple of months. Let me just say this: there is a 90% chance that your name will come up in any conversation I have with someone about raising funds and I attribute this fact entirely to your genuine, honest dealings with people.

By: Gary Carroll

Gary Carroll — Wed, 07 Jan 2009 01:55:52 +0000

Maybe a simple filter would be for you to list your hot button(s) for the month. If I know you are looking for "abc" then maybe I can tailor my plan to fit your need if it close enough.
I'm starting a new plan and trying to find the right VC's to send it to.

By: bfeld

bfeld — Wed, 07 Jan 2009 01:55:52 +0000

Christian – thanks for the kind words! I’m glad “what I’m trying to do / how I’m trying to be” is translating into reality.

By: dgcohen

dgcohen — Wed, 07 Jan 2009 01:55:51 +0000

I think it's fantastic that you've explained how you evaluate deals. You've always had a great reputation for not doing the classic "VC string along" so to me the value add here is just learning how you guys think about your dealflow in a bit more detail. Great post.

By: scott_yates498

scott_yates498 — Wed, 07 Jan 2009 01:55:51 +0000

Hey, I hear what you are saying, and it's always good to learn when possible, but a lot of Brad's post points out that he often says no for reasons that don't have anything to do with the pitch. If it's not in the "theme" he's looking at now or if there is some conflict because of some other investment, then there's nothing really for you to improve that would have brought a "yes."

Imagine if Brad, for instance, said, "This doesn't fit within what we are looking for. Oh, by the way, I think you should make your product in blue." Well, the entrepreneur might have all kinds of hard data about why blue is no good, but they will then go out and make one in blue at great expense. Then they will go back to Brad with the blue one, and he still won't be interested because they didn't listen to the first part of the reason he's not interested.

For the entrepreneur, there's a tricky balance between sticking with your vision and adopting the wisdom of others. It is important to learn, but the first most important part is to really listen.

By: scott_yates498

scott_yates498 — Wed, 07 Jan 2009 01:55:51 +0000

I agree with David, and sorry if my post made it seem as though Brad should not have posted what he did. If I was in Brad's spot it would just be hard to make that kind of thoughtful reply to all the requests that come in through the transom.

Now he can just point people to that post along with his "no."

By: DisMonkey

DisMonkey — Wed, 07 Jan 2009 01:55:51 +0000

I'm sure bad pitches are _not_ a unique experience for you… In our case, we had a "perfect storm" of events that lead to us giving you one of the worst pitches I've ever presented. Obviously we would have preferred that things not turn out that way, but your quick follow up with clear feedback at least ensured we knew where we stood. You were relatively gentle too, all things considered…

I'll take straight talk and transparency over vagaries and BS any day. We still think you guys are a great group and will undoubtedly try pitching you again — hopefully with a better result on both sides

Finally, I could not disagree more with the comment from Scott, above. The reason for the "no" is incredibly important to know. Otherwise how do you refine your idea and pitch? It'll be a very short ride as an entrepreneur if you can't digest clear feedback and figure out what to act on and what to ignore…

By: Jeffrey

Jeffrey — Wed, 07 Jan 2009 01:55:51 +0000

As another recent recipient of a "no" I'll chime in to say that I really appreciated getting the no quickly, but getting more information on the "why" would have been even more helpful. There's always the risk that the "why" will be a huge bummer, and I realize that composing a detailed response in each case may not be something you have time for, particularly since you've just launched a new fund.

By: Jevon MacDonald

Jevon MacDonald — Wed, 07 Jan 2009 01:55:51 +0000

The biggest difference between a good VC and a bad one is the simple ability to say "No" as soon as is possible. Doing that avoids wasting everyone's time and also makes it easier for the entrepreneur to come back the next time they have an idea, because they know their time will be respected as well.

For something as obvious as that statement is, it is amazing how few VCs actually live it.

By: Dan Mantineo

Dan Mantineo — Wed, 07 Jan 2009 01:55:51 +0000

This is great information and you are rational in your responses. Being on the "passed on" side of things, it is always a let down because you think your product is the next big thing in business. However, your explanation for why you did not want to invest got me looking in a different direction for financing. I am currently working with a differnet investor on my project that I would not have found if you did not word your response the way you did. If you had just said no, I would not have changed my strategy slightly. Also, your response also got me thinking about new ideas and startups that I could do that were more horizontal rather than vertical.