Dear SaaStr: What Were The Top Unforced Errors You Made Raising Your First VC Rounds?
A few unforced errors I made as a founder pitching VCs:
- Meeting too early. I pitched a few friendly VCs before EchoSign was really ready. Sometimes, that’s OK, but not with these 2 funds. They wanted us to be at least close to launch. Know Thy Funder.
- Being too aggressive. I blew perhaps the most important VC meeting I needed for my first startup by being too aggressive on price. Ironically, I didn’t personally care. I was just following bad advice from a pre-seed / angel investor. Bad advice. I was too pushy and alienated my top choice, and really, my best choice.
- Having a key team member quit during fundraising. While I didn’t fully plan for this, I should have been clearer on the risk. A fund pulled their term sheet, as they should have.
- Taking money from jerks. Even when it seems like your only offer. Yes, sometimes you have no choice. Sometimes you just get 1 offer. But try even harder. Having a toxic investor, even a subtly toxic one, ripples for years. Maybe decades.
- Hiding anything. OK, I didn’t actually do much of this myself, but the one time I did it (a customer issue), I got burned hard. And I’ve ended up not investing in several promising founders that hid stuff. Don’t hide stuff. Get it out early, in either the first meeting or before the second — and just address it. No early-stage VC expects things to be perfect. But they don’t like having to figure out the issues on their own.