Last night, at the Churchill Club’s annual VC roundtable in Mountain View, CA, venture capitalists from firms like Greylock Partners, Khosla Ventures, and New Enterprise Associates told an audience how to best pitch them.
Of course, none of these investors could agree.
For instance, Peter Sonsini, a partner at NEA, told would-be entrepreneurs they should use VCs’ famous “herd mentality” to their advantage. Build up that allure, he said, make it seem like competing firms have been flirting with you in the hopes of throwing money at your startup. Entrepreneurs shouldn’t lie but there are ways to convey that you’ve got other suitors without seeming hokey. Like if a VC on Sand Hill Road agrees to meet with you Sonsini said, “You can tell them, ‘I can’t. I’m going to be local, but I’ve got meetings.’”
You can imagine the reaction of some of his fellow moneymen.
“I don’t think that thinking of VCs as a class is a helpful construct,” John Lilly, a partner at Greylock, said.
Sonsini backtracked a bit. He views playing to the herd mentality as simply a signaling tactic. It sounds like dating: it doesn’t hurt to look desirable or in demand. You don’t want your prospective date knowing that you sit around in sweat pants all day, clicking to Buzzfeed for cat photos, right?
Andrew Chung, a partner at Khosla Ventures, said his firm looks for outliers and ways to be contrarian, not for what’s popular today. He also said it’s helpful to think of a pitch as a performance. And he should know: he almost pursued a career in singing. In the past, Chung has won a national Chinese singing contest, was a finalist on China’s version of American Idol and has performed at Lincoln Center. “You’re making a performance. And the subject of this performance is the company you’re working on,” he said.
Perhaps fearful of the circus acts that might descend on their Silicon Valley offices, some didn’t give their thumbs up.
Lilly for his part, advised entrepreneurs not to think of a pitch as a pitch. Instead, it should be a longer process, a decision that comes after weeks and months of getting to know an entrepreneur. “I’ve never invested in anyone because of a pitch,” he said.
Others chimed in, claiming subsequent meetings don’t occur if you’re not compelling in the first one.
So to recap, take advantage of VCs’ herd mentality but don’t think of them as a herd, and when you pitch make it a performance except don’t think of it as a performance; instead divine it as a longer relationship that won’t happen unless you are compelling enough the first time.
Confused? Of course you are. Really though, every VC has his or her own personal style. Pitch accordingly.