I'm a 4x founder and Angel investor. Building a private community of founders and an angel syndicate to invest between $30k to $100k in great founders.
One of my worst founder calls
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Shout out to our Media Production Team Hey friends This week's newsletter is a bit different. Frankly speaking I'm so busy with the Fundraising for our VC fund, that I couldnt spend time thinking and writing this week's issue. While, I'm fundraising and building a small seed stage fund, I also help founders in later stage fundraising and with their product / startup operations. After doing it for more than 12 years, I did learn a thing or two. I want to share a small summary of a conversation I had with an amazing founder a few weeks ago. Founder: Thank you for meeting me. Dan (our mutual friend) told me to talk to you about our round. Me: Happy to. How can I help? . . . Founder: So, we are building the next generation personal finance management system that will change the way people manage their finances. You can stake your crypto, different currencies, etc. The target market is worth $3 trillion. Me: Uh huh. You got a deck? Founder: Sure, its half baked. (pulled up a deck) - Second slide; This is how it will work, 9th Slide, Still this is how it will work (All Screenshots of the app for 8 slides in a row). Second last slide - And this is our team. We are raising $2 million Seed round. Me: What would you like from me? An honest opinion or something that will make you feel better but not good. Founder: Oh, Honesty! I love that. (they dont but ok) Me: I think you have spent 80% of the deck on showing 'How' it will work. You might want to change that. The team doesnt need to have the full list of freelance developers that you have hired from upwork and fiverr. A GTM would be a good addition. But, the major piece that is missing is the 'Problem' - how do you know that is a big problem to solve? Unique Proposition would... Founder: (Jumped immediately) Oh, I have a lot of friends who think this is a cool idea. Me: But your friends arent your customers. Or even if they are, I doubt you have enough friends to justify the TAM. . . . Founder: Another thing that I have to tell you is that I want to raise $2 million Seed money to complete the development, but I dont ever want to sell or exit the company. I want to run it and this is the only time I will give up some equity. Me: You really dont need VC money for that. (polite way of saying, you are not a fit for any VC) Founder: No no no. I want to rely on their money. I dont want to feel the pressure of making sales and living without good pay. I will use their (VCs) money for that..... continued for another 5 mins Me: Sorry if I appear rude but I dont think I can be of any help. Best of luck on your round and whatever you are building. Founder: Yea sure, no worries. Everyone of you (I am assuming she meant VCs even though I'm not one yet) is so far not interested. Maybe I need to find a way to talk to guys are Sequoia or a16z (Thought Andressen Horowitz and a16z are two different firms). ************** End. ConclusionI couldnt figure out what to make out of this call. I talked to my friend and he was very apologetic of this (he doesnt need to be and he also reads this newsletter :) ) but I figured that is why people dont like to make intros anymore. I hope you are not a founder like this. VCs are not just your rich dad who will write you a million dollar check that you can go and spend in Ibiza. They are in the business too, and that business model is totally different than building a SaaS. I hope you will find it helpful and maybe a bit amusing. Latest from our Prodcircle PodcastI usually host VCs and VC backed founders on the podcast but made an exception with Sharon here. She was amazing, got rejected by multiple VCs, bootstrapped the company, ran for 20 years, had a lot of fun and then sold it for $25 million. Watch the full episode here Whenever you’re ready, there are 3 ways I can help you:
Until next time, M. |
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I'm a 4x founder and Angel investor. Building a private community of founders and an angel syndicate to invest between $30k to $100k in great founders.
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