What’s the best way to understand investor behavior?

Fred Wilson (Co-Founder and Partner at Union Square Ventures)
The Grind – AVC

I started yesterday at 8am with a breakfast meeting. I ended around 8:15pm when I wrapped up a pitch meeting in my office. In between those two meetings I did ten other meetings for a total of twelve meetings in a bit more than twelve hours. Of those twelve meetings, one was a three hour board meeting, one was a breakfast meeting with another venture investor, one was a lunch meeting to talk about CS Ed in NYC, four were pitch meetings, one was … (read more)

What’s the best way to understand how your VC thinks about your business?

Fred Wilson (Co-Founder and Partner at Union Square Ventures)
Can The Crowd Be More Patient? – AVC

Internet and mobile product development cycles are measured in months not years. And the capital required to get a product built and into the market is less than $1mm. And the returns, when things work out, can be enormous. Contrast that with biotech. A new drug takes $100mm in capital investment to get to market. And that process can take a decade or more.

What’s the best way to understand how your VC thinks about your business?

Fred Wilson (Co-Founder and Partner at Union Square Ventures)
From The Archives: The Poker Analogy – AVC

Early stage venture capital is a lot like poker. The first round is the ante. I think keeping the ante as low as possible is a good thing. I like to think of it as an opportunity to play in the next round and to see the cards. Clearly, we don’t ante up to just any deal, but it is very useful to think of the first round as the ante. For the first year or 18 months, however long the first round lasts, you get to “see your cards”. You learn a l… (read more)

What’s the best way to understand how your VC thinks about your business?

Fred Wilson (Co-Founder and Partner at Union Square Ventures)
Some Thoughts On Tweeting Vs Blogging – AVC

[when thinking about Twitter] I had been blogging for almost four years at that point and was completely sold on the huge benefits that come from publicly sharing your insights, opinions, and decisions. I would advocate blogging to everyone. And folks would try it. And that vast majority of them (way greater than 90%) would not be able to sustain it. So when tweeting showed up, I thought “well this has most of the benefits of blogging but is at l… (read more)

What’s the best way to understand how your VC thinks about your business?

Fred Wilson (Co-Founder and Partner at Union Square Ventures)
The Perception Of Conflict Is Conflict – AVC

If you cannot get an entrepreneur to listen to you objectively and rationally, then you have lost your greatest hope of postively impacting that investment. And that is a tool that VCs should not throw away lightly. So the meta point I am making in this post is that it isn’t the facts that matter when discussing conflict. It is the perception that matters. If anyone in a relationship with you percieves that you are in a conflicted situation, you … (read more)

What’s the best way to understand how your VC thinks about your business?

Fred Wilson (Co-Founder and Partner at Union Square Ventures)
Venture Capital Returns – AVC

Early stage investing is hard. You lose more than you win. And when you win, you need to win big. Later stage investing is a bit easier. You can pick winners in that business more easily. But so can everyone else. Each deal is an auction and the winner pays the highest price. So the next time you are bidding one VC against another, maybe you can feel just a bit of empathy for us. We are in a tough business, trying to make a buck to live to fight… (read more)

What’s the best way to understand how your VC thinks about your business?

Fred Wilson (Co-Founder and Partner at Union Square Ventures)
Where’s My Billion Dollar Check, I Wonder – AVC

Startups are hard. They require great sacrifice from everyone. They are stressful and fail more often than they succeed. And when you’ve been toiling away month after month, year after year, with no pot of gold in sight, it can be hard to watch that billion dollar deal go down. It’s a punch to the gut. It hurts. I’d love to say to all of you who are feeling that pain that your time will come. But most likely it will not. That’s the way this game… (read more)

What’s the best way to talk about business risks?

Fred Wilson (Co-Founder and Partner at Union Square Ventures)
What Do I Wish Entrepreneurs Would Ask? – AVC

All businesses have challenges, weaknesses, risk factors. These don’t generally get in the way of us investing, as long as we and the entrepreneur(s) are aligned about them and the need to manage and mitigate these risk factors as quickly as possible. We are drawn to an investment by the upside potential of the business and we recognize that every investment we make has significant downside potential as well. Our hope is that the founders and man… (read more)

What’s the best way to talk about business risks?

Reid Hoffman (Partner & Co-Founder at Greylock Partners)
LinkedIn’s Series B Pitch to Greylock: Pitch Advice for Entrepreneurs

Steer into your investors’ objections. There will be one to three issues that are potentially problematic for your financing — address them head on. You have the most attention from investors in the first couple slides. Most investors arrive with questions, and if you proactively show you understand their principal concerns, you earn their attention for the rest of your pitch.