It’s still early to determine whether SVB’s decline heralds a new era for venture capital, but based on anecdotal evidence, off-the-record discussions and conversations with colleagues, it appears we’re back to business as usual where pre-funding starts. concerned.
Not a scientific sampling, but several investors signaled on Twitter this week that they remain interested in talking to founders who are still in the idea stage. My hot approach. with contagion content, the VC community feels good about writing small checks to pre-revenue startups, but Series A and beyond. LESS than more.
As long as this dip persists, this investor Q&A will be a monthly TC+ column. If you’re a recently laid-off worker considering striking out on your own, an H-1B worker who’s had it up until now, or just looking for tips and advice that can help you connect with early-stage investors, please read and share.
Many thanks to all contributors who took the time to answer these questions in such detail. If you are an early stage investor who would like to be included in future columns, email
Here are who participated.
- Brian Backeen, General Partner, Lightship Capital
- Masha Bucher, Founder and General Partner, Day One Ventures
- Rebecca Lew-Doyle, CEO of Insight
- Clelia Warburg Peters, Managing Partner, Era Ventures
- Nick Adams, Managing Partner and Co-Founder of Differential Ventures
- Lisa Lambert, Founder and President, National Grid Partners
- Elizabeth Yee, Co-Founder and General Partner, Hustle Fund
Brian Becky
What investment opportunities are you looking for in March 2023?
Like many investors, we’re bullish on AI. We made two AI investments in April and continue to pursue opportunities in that space.
How do you prefer to be approached by the founder in his opening statement? cold email, warm introduction or other method.
We have an online portal at lightship.capital that founders can use to apply for investment. We do this to prevent a problem with VC investors called “network bias”. Founders should apply to our portal and follow it Twitter:.
What is a traditional fundraising tactic that founders should remove from their toolkit? something that no longer works but is still common practice.
Asking for warm introductions and “building relationships” with investors. Spend your time building a great business and you will get investment. I don’t need new friends.
Tell us about the best game you got recently. When did you know during their presentation that you were going to invest?
I was recently recommended by a company called MuseTax. Excellent founders, subject matter experts; the real deal. They had me invested within the first 10 minutes. They are in earnest now.
Can you share one tip that can help a first-time founder stand out?
Don’t focus on investments. focus on design. Don’t let your engineers build you an ugly product with great password reset functionality but limited user value.
Don’t let the engineers tell you it’s not ready. it is. Push it out and learn.
Design it well and users or investors will follow. Do the first version well and you get lots of engineering bills and no progress.
What are you reading/watching/listening to right now?
I keep re-watching Season 1 of Billions. You know, before it got weird 🙂? Great show.
Masha Bucher
What investment opportunities are you looking for in March 2023?
In a healthy fundraising environment, the founders who do best often rely on their storytelling skills and can convince investors with their charisma. They are the ones who are naturally good speakers and articulate their vision.
There is a second type of founder that has a different background. They are often headstrong, clumsy and resource oriented. I call them “survivors”. Survivors are often immigrant founders, people of color, women, or others from underrepresented backgrounds.
I believe that survivors are the types of founders to lean on in a downturn. They were forced to be scraps and survive their entire lives. they are especially equipped to handle what the current times demand of them. They are good at making something out of nothing and are extremely cost effective.
I’m looking for ways to monetize, business models and ways to generate returns. Investors pay much more attention to numbers, business models and financial management of founders. Expect many more questions that challenge the business model.
I look at how much revenue is generated from product quality versus marketing. Founders who generate virality based on product quality show they can make money with little marketing spend.
We like companies with high EBITDA. We love companies like Quinn’s, which grew to millions in revenue in just one year after launching with viral, zero-cost marketing on TikTok.
How do you prefer to be approached by the founder in his opening statement? cold email, warm introduction or other method.
Cold mailing works great, but it’s surprising how few people get it right. Every sentence in a cold email should convince me to go on a date. With every word and every sentence, you need to make the investor want to meet you in person. You need to give a clear reason why they should meet you now, not next month.