[HN Gopher] Investors won't give you the real reason they are pa...
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Investors won't give you the real reason they are passing on your
startup
Author : bx376
Score : 18 points
Date : 2024-05-03 06:52 UTC (16 hours ago)
(HTM) web link (techcrunch.com)
(TXT) w3m dump (techcrunch.com)
| fellowniusmonk wrote:
| tldr. Your team isn't impressive enough.
| barrenko wrote:
| The significant other won't tell you why they cheat on you, the
| employer won't tell you why they picked that other guy / gal.
| Your grandma doesn't know why you're her favorite grandkid.
| rootsudo wrote:
| Of course, that is because in case you are a unicorn on next pass
| they didn't throw you under the bus. So you'll chat with them and
| like them.
|
| It's the expression: "if you don't have anything nice to say,
| don't say anything at all."
|
| The Silicon Valley tv series has this great when Eric Baurich
| goes from begging to being mean and that's is a great example of
| this.
|
| Same for anything, employment, dating, friends, etc.
| theideaofcoffee wrote:
| It's like job hunting in a way too, they can reject you, but
| you're also interviewing them for their resources and fit too.
| Why shouldn't I just ignore them if they ignore me? If we do
| happen to grow to a point where they'll come crawling back
| begging to be part of thE nExT rOUnd, isn't that a signal that I
| shouldn't even bother? They did tip their hand first...
|
| I don't know why I would give them the time of day, same as I
| would anywhere that rejected me for a job but later had a change
| of heart.
| JumpCrisscross wrote:
| > _Why shouldn't I just ignore them if they ignore me?_
|
| Generally speaking, running a business is an exercise in
| pragmatism. Rejecting capital simply because they once slighted
| you is closer to a personal issue for a therapist than anything
| which belongs in the office. (Also, have you never heard of a
| happy couple who didn't hit it off the first time they met?)
| ethanwillis wrote:
| What does Sony know about investing in a bakery?
| erichmond wrote:
| The interesting part here is that it's actually a two-sided
| marketplace. Most investors aren't "impressive" either, and thus
| they'll often not be able to get into the best deals because they
| have no value add.
| fakedang wrote:
| I recently read some reviews of investors in SV. Some name
| brand investors like Jason Calacanis, Pejman Nozad, and some YC
| alumnus, are all actually very clueless people, often with
| acerbic behaviors to boot. In that respect, at least the
| investor class of Wall Street seems to have a much higher
| degree of expertise and civility, compared to the buffoons of
| Silicon Valley.
| gfourfour wrote:
| There's a lot of cargo-cult mimicry of Steve Jobs and Elon
| Musk that happens in terms of behavior.
|
| But those guys were product people and to the extent that
| their low-empathy personalities were beneficial it's in the
| fact that they cared about creating things far more than
| anything else, including other people or money. The phrase
| "artistic temperament" long predates them for a reason.
|
| But it's really absurd and counterproductive to try to mimic
| that personality if what you're offering is anything other
| than being the corporate version of an auteur, and if that's
| what you were you wouldn't be mimicking anyone, and you
| better produce some stunningly consistent results. Lots of
| these guys think they're being uncompromising about "their
| vision" when it's really just "their vision" of their spot on
| the Forbes list.
|
| New York is better in part, I would guess, because there's no
| false premise that the investor is doing anything other than
| acting as a conduit for capital. There's egos too but no one
| is trying to live up to the standard of "changing the world"
| or "innovating" or being "the next ___."
|
| It probably also helps that Warren Buffet is the most
| successful traditional investor of all time and a model of
| good behavior.
| Beijinger wrote:
| With investors, it is probably the same situation with
| employers.
|
| A rejection does say nothing about you. The guy the hired
| says a lot about the company.
| klik99 wrote:
| You can usually tell who these are by seeing if most of their
| portfolio they aren't primary investor.
| contingencies wrote:
| <opine>Team is mostly BS. The chances that even a really good
| investor, who is not actually in the game, can accurately
| determine an early stage startup's commercial trajectory by
| magically intuiting from highly condensed summaries of multiple
| people's multiple decades of nuanced experience, is near zero.
| Yes, there is insight to be had there, especially at the pointy
| end of 80/20, but there are far more significant factors in most
| cases. Long term VCs will tend to overstate the importance of
| character due to survivor bias (ie. the successful follow-ons are
| the only founders they really get to know).
|
| IMHO most early stage investment is made based on hunches and
| hand-waving after doing generalist macro assessments of
| particular industries or trends. Frequently, faddish. GP's will
| often do this, raise a fund around it, then associates are sent
| out to get deal-flow and execute. Many startups will be get
| selected from an available pool with the established investment
| theme. This capital is largely sacrificial, and high miss rates
| are expected.
|
| Where things get serious at the personal level is in the mid to
| later stages where you start to see bigger figures being moved
| about and investors want a shepherd for their capital who has
| proven stable and long haul capable - things like the capacity
| not to suddenly live beyond their means, lose focus, drop it all
| and go to Vegas, crash and burn at HR management, or break down
| at the first signs of difficulty. That said, you also get
| mechanics being added like tranched deployment and
| fiscal/management oversight (eg. board seats) which are highly
| effective at mitigating risk even in a low-trust scenario. Most
| VCs are early stage and never play at this level.
|
| _To put it bluntly: early stage is mostly noise. Mid to later
| stage, if they want the deal, they 'll make it happen._ It's your
| job to be so damn good they can't help themselves.</opine>
| JumpCrisscross wrote:
| > _by magically intuiting from highly condensed summaries of
| multiple people 's multiple decades of nuanced experience, is
| near zero_
|
| One can't guess the successes. But you can eliminate the duds
| who won't make it to a Series A.
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