This post is by Jason Lemkin from SaaStr
Click here to view on the original site: Original Post
Let me at least share my first meeting with a VC. It went really well. The very first VC I ever pitched as a founder offered to fund us tentatively with $5m — by the end of the first meeting! And … then I blew it. What happened? Well, first the intro was from an ex-boss, so I had a strong warm referral. I also had a pretty good deck and presentation and team. Market timing was also on our side. We had 2 strong early reference customers. And … we were a pretty good duo pitching, my co-founder and me. Bear in mind, I’d done a lot of VC pitching as a VP as start-ups before. I knew what a good pitch was, and what good metrics were, and what VCs were interested in. I was new as a founder, but not new to fundraising. We fairly quickly got
draft term sheet for $5m on something like a $10m pre. Not a great deal today given the early traction we had, but plenty fair for the time. I went and asked some folks what to do. I was advised to push back and ask for a significantly higher price. So … I did. Without even thinking about it. I asked for something like $7m-$8m at a significantly higher price. The details I sort of forget. But I know I asked for materially more. The VC got offended / pissed / angry / spooked / worried / something. I don’t know what to this day. But he went dark. I asked him 4 weeks later what happened, and after 3 emails or so, he finally responded. He said I had just pushed him too hard. Without knowing it. But knowing what I know now, I think I pushed him out of his comfort zone. His fund wasn’t huge, and $5m was likely a “bite size” he was comfortable with. But more than that was just too big of a check. So he walked. And in the end, there was drama, and we had to settle for less than $8m pre from another, worse investor. So it wasn’t worth it on any level. So then I learned to push, for sure — but to listen. Carefully. To learn what each VC is able to do, is comfortable to do. And not to accidentally cross those lines. Especially without knowing it. View original question on quora The post What was your first meeting with an angel investor like? appeared first on SaaStr.