SAI contributor Mark Davis is a venture capitalist at DFJ Gotham. He also writes Get Venture, a blog aimed at helping entrepreneurs trying to raise money from VCs. We’ve previously published Mark’s thoughts here and here.
As previously described, the objective of your first meeting with a VC is not to spell out every detail of the business but to generate enough initial interest to get the partners to spend time learning more. To do this, you’re going to have to demonstrate that you are more than a competent manager. You’re going to have to show that you can make your vision a reality (a.k.a., execute).
Proving you can execute is something that you ‘show’, not ‘tell’. A VC is not going to ask you ‘are you prepared to execute?’. Instead, you are going to hear one word over and over: ‘how?’
‘How will you build the site?’. ‘How will you acquire customers?’. ‘How will you advertise?’. How? How? How?
The word ‘how’ will often be accompanied its good friend ‘many’.
‘How many programmers do you need?’. ‘How many sales reps will you hire?’. ‘How many geographies will you target initially?’. ‘How many partnerships will you acquire?’. How many months until launch?’. How many? How many? How many?
Be prepared to explain all of the details behind ‘how’, but in the initial meeting, only offer these details when specifically asked. Otherwise you could get caught up in details and not accomplish your goal of having the VCs buy into the bigger picture.
Knowing the answers to the ‘how’ questions will not only help you ace the meeting, but also ensure that you are indeed ready to launch your venture.