Setting VC Meetings: Introduction
In setting appointments there are two primary challenges. The first problem is providing the investors with compelling material that convinces them to sit down with you. The second more difficult problem is getting the investors to read it. The tools that an entrepreneur needs to set an appointment with an investor are the elevator pitch and the executive summary. Getting the investor to read or listen to the material is really only accomplished by making a personal connection or getting an introduction. Both of these problems are exacerbated by attempting to contact inappropriate investors. Entrepreneurs should ensure that the investors they approach meet these three criteria before attempting to set any meetings. First make sure the investor invests in your industry. For example Hummer Winblad is a software investor and they do not invest in chips or biotech. Second, make sure the investor invests at your stage. LeapFrog Ventures is an early stage investor and they don't particpate in series C financing rounds. Lastly and most importantly, make sure that the investor you are approaching does not have any competitive investments. Ethical investors won't meet with companies that are competitive with their current portfolio companies. However, less ethical investors will gladly meet with you and then share your business plan and secret sauce with their portfolio companies.
First and foremost, setting appointments with investors is more about networking and less about having a great product. Ultimately, you will need a great product to get funded but I have been told that last year zero companies were funded by VCs without an introduction or personal connection. That means that submitting a summary or business plan via a VC’s website is virtually worthless. Privately numerous VCs attest to this. Rather than bemoaning the 'old boys club', I suggest that entrepreneurs accept that they are going to have to dedicate several hours per week to setting appointments. If you need money to grow your business, not even the best products will get funded if no VCs are talking to you.