Many startups misunderstand the common advise to ask prospective investors questions during pitch meetings in my nine years as a VC.
These inquiries may often derail, distract, and make investors feel defensive. To prevent this, I teach founders an approach based on my experience as a high school math teacher and centred on developing rapport, sustaining continual involvement, and establishing a shared reality. The goal is to ask questions with a minimal cognitive burden.
To put it another way, just ask simple questions of investors.
Assume your business is a paper mache start-up. One of the worst ways to start a meeting as a generalist investor is to ask me to discuss my thesis on the paper mache sector. I don’t have one, therefore as soon as you pose that question, my cortisol levels will skyrocket like those of a worried kid who hasn’t done his homework and has been summoned by the instructor.
Save the tough questions until when you’re choosing between numerous investors who are ready to write checks after you’ve persuaded them that your business is viable.
I’ll then try to salvage face by making up as much intelligent-sounding material as I can on the spot. But I’ll know deep down that whatever I just said was bullshit, and my brain will strive on a subconscious level to get this meeting over with as quickly as possible in order to prevent more callouts.
This isn’t the place for us to be if you’re expecting I’ll invest in your firm. Save the difficult questions until when you’re choosing between numerous investors who are ready to write checks after you’ve persuaded them that your business is viable. Ask simple inquiries at the beginning of your conversations. These might start with basic yes/no questions.
One of the engagement strategies I learnt as a math teacher was to ask kids simple questions: I frequently got blank glances and no replies if I had them ponder too much at initially. However, if I posed a simple question, such as “What is the inverse of addition?” I’d receive a response right away. In the same way, approach an investor pitch.