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"I think one of the biggest unexploited opportunities in startup investing right now is angel-sized investments made quickly. Few investors understand the cost

by jfarmer 13y ago

"I think one of the biggest unexploited opportunities in startup investing right now is angel-sized investments made quickly. Few investors understand the cost that raising money from them imposes on startups." Oh lord yes. Having been through the fundraising process a few times, it's hard to describe the sheer relief when you find an investor willing to give a quick yes or no. The best I can describe it is like the feeling of getting a Christmas present you really, really wanted but didn't think to ask for. SV Angel and a16z are two of the best I've ever interacted with in this regard. It's clear both firms deeply respect entrepreneurs' time.

privacybuff 13y ago
I propose that investing is a market and the state of that market will depend on how the participants act. So, let me throw this idea out there: Be the kind of company that can pitch a VC and if they don't have a YES/NO answer to you within a week, pass on the VC. I think there's a power imbalance because founders want money more than VCs need to invest. I think the economics are such that founders should have a lot more power. When founders start demanding quick decisions (or more specifically, requiring them) ... the decision making process will become quicker.
deleted 13y ago
[deleted]
jmtame 13y ago
It's interesting that you point this out. I have always felt that way about investors: I would much rather have a fast "no" than an indefinite answer indefinitely. For that reason, whenever my friends give me a pitch deck and are looking for recommendations, I'll usually pass them along to Kevin from SVA, who is not only an awesome person but has always acted quickly. When I think of the slow investors, I never recommend them to friends. Decisiveness may be the new proxy for judging how good investors are (aside from their portfolio, which currently acts as the main signal).
peloton 13y ago
The unfortunate reality is that it's not about the firms, it's about whether the individual partner at the firm respects founders' time. For example, I know founders who have had unpleasant experiences with an investor at a16z.
- pmarca 13y ago
  Who? Let me know so I can fix it!
  - peloton 13y ago
    Not comfortable naming names but investor was late and founder said it felt like investor already knew it was a pass since he started meeting with something like "just for full disclosure we typically don't invest..." (I made this quote up-- I'm just trying to give you an example)
    - pmarca 13y ago
      Please have the founder send me an email at pmarca@a16z.com so I can fix. Thanks!

by jfarmer 13y ago

privacybuff 13y ago

I propose that investing is a market and the state of that market will depend on how the participants act. So, let me throw this idea out there: Be the kind of company that can pitch a VC and if they don't have a YES/NO answer to you within a week, pass on the VC. I think there's a power imbalance because founders want money more than VCs need to invest. I think the economics are such that founders should have a lot more power. When founders start demanding quick decisions (or more specifically, requiring them) ... the decision making process will become quicker.

deleted 13y ago

[deleted]

jmtame 13y ago

It's interesting that you point this out. I have always felt that way about investors: I would much rather have a fast "no" than an indefinite answer indefinitely. For that reason, whenever my friends give me a pitch deck and are looking for recommendations, I'll usually pass them along to Kevin from SVA, who is not only an awesome person but has always acted quickly. When I think of the slow investors, I never recommend them to friends. Decisiveness may be the new proxy for judging how good investors are (aside from their portfolio, which currently acts as the main signal).

peloton 13y ago

The unfortunate reality is that it's not about the firms, it's about whether the individual partner at the firm respects founders' time. For example, I know founders who have had unpleasant experiences with an investor at a16z.

pmarca 13y ago
Who? Let me know so I can fix it!
- peloton 13y ago
  Not comfortable naming names but investor was late and founder said it felt like investor already knew it was a pass since he started meeting with something like "just for full disclosure we typically don't invest..." (I made this quote up-- I'm just trying to give you an example)
  - pmarca 13y ago
    Please have the founder send me an email at pmarca@a16z.com so I can fix. Thanks!