In this first week working at the Reese News Lab, I feel like I’ve been constantly learning new things about journalism and entrepreneurship. I’m being exposed to topics that I’ve previously known absolutely nothing about, such as venture capital. Before we spoke to David Jones, a partner at Bull City Venture Partners, I didn’t really understand what venture capitalists really were or what they did.
Now I know that they’re not just investors, but investors for groups like ours. Instead of investing in big public companies, they invest in new, high-risk, high-return ideas. Because of what I’ve learned, I feel like I’m not only more informed about what they do, but also about how they relate to us and how to pitch to them. We may still not know exactly what we’re creating this summer, but I am starting to feel more confident about pitching whatever idea we do create.
1. People matter
At first, all I knew about venture capital was that it had something to do with investments. With that in mind, I had a vague image of computers and rows and rows of numbers and dollar signs. In fact, venture capitalists aren’t just looking at numbers. VCs are not just betting on your products, they’re betting on you to get the job done. People and relationships matter. If your startup team is solid and reliable, then your startup seems like a better investment. Make it clear that you understand what it means to be an entrepreneur, and you’re willing to do the work.
2. Have a plan
Going off of that, have at least the semblance of a plan for your idea. As good or as profitable as your idea may be, it needs to be more than just an idea. This does not mean that you necessarily have to have a physical product or workable service, but you do have to have an idea about how you want to get from A to B and what you want to do once you get there. VCs are interested in the service that you’re excited about expanding, the product you have long-term plans for, not the great idea you think you might be able to flip quickly.
3. Think about the customers
As you’re creating and tweaking your product, remember who you’re creating it for. Think about your market and your customers’ specific needs. Ask for feedback from everyone; use their critique to make your product better. Keep them in mind when you’re pitching to show that you’ve done your research and that there is a market for your product. VCs are interested in products with big markets and the momentum to sustain them.
4. Connect the dots
If the VC doesn’t give you a solid yes at the first meeting, or even if he or she gives you a no, don’t leave it at that. Ask VCs for feedback as well, and take it seriously. Keep in touch with them as you implement changes and let them know if you’ve improved issues they were concerned about. Our speaker used the image of dots and lines: While a single meeting is a dot, a series of meetings create a line. You want to create a line. Investors are more likely to invest if they remember you and your story than if you are simply a one-time face.
These are all things to keep in mind during your pitch, but I think the important takeaway I got was that it’s very much about the journey. If you work with an eye on the future and prepare your project thoroughly along the way, your pitch will invariably be more convincing.