Why VCs Really Reject Startups 217
Posted
by
timothy
from the busy-taking-notes-for-friends dept.
from the busy-taking-notes-for-friends dept.
itwbennett writes "Instead of simply not following up with startup proposals that he doesn't intend to pursue, venture capitalist Josh Breinlinger decided to change things up and not only hear every pitch request but respond with honest feedback. For those on the receiving end of that honest feedback, Breinlinger's silence may have been golden. It turns out that Breinlinger, and perhaps most VCs, reject your proposals because you lack experience and leadership skills and your team is weak. Would you rather hear the hard truth about why your startup didn't get funded or some vague dismissal?"
Re:Not surprised. (Score:5, Informative)
Perhaps you've heard of this company called Google - started with a $25 million investment from Kleiner Perkins Caufield & Byers and Sequoia Capital.
No. Google had been around for years, and had a solid track record by the time VCs got interested. They did get angel funding of $100K earlier, but even that was after they had been up and running for over a year.
Re:Not surprised. (Score:4, Informative)
Re:So did Steve Jobs (Score:5, Informative)
You may not believe this, but Steve Jobs's wasn't the first or even the second CEO of apple computer.
In fact, the man behind the initial venture capital foray of Apple was Mike Markkula (who served as the CEO). He was an initial angel investor who was referred to Mr Jobs by a few other VCs. Mike provided the "adult" supervision to Jobs and Wozniak during the fund raising part of company's existance. Initally, Mike hired Michael Scott (from either national semiconductor or fairchild, I forgot which one) as the first CEO. It was only later after some turmoil that Mike took over the CEO position and then yielded the CEO position to Jobs (and later supported Sculley which led to Jobs' departure, and then helped lure Jobs back).
So even Mr Job's didn't just walk into VC offices and get funded as the CEO of the company. But, Jobs was smart enough and passionate enough about doing the work that was able to put his ego enough in check to know that in order to get the money they needed to get it done. I believe that the Google story is very similar with Eric Schmidt performing the "adult" supervison...
Re:Hard truth (Score:2, Informative)
Actually patent attorneys are fairly useless.
What you need to do is to follow the procedures accurately, even down to stupid things like font sizes and such. Then when it gets rejected, you address the points made in the rejection and re-submit it. It usually simply passes then. If not, the examiner will have raised valid points you need to address again.
Note that patents usually are worthless. Unless they are illegally broad, it's trivial to work around them. If they are not worked around, they typically are useless. The patents that do generate money are the ones referenced in standards or the ones so trivial people stumble across them.