These days, there are a ton of options for you if you’re a startup seeking guidence.  Every single topic about running a company has been written about ad nauseum, there are incubators, accelorators, mentoring programs, events, talks, etc.  We’ve done a lot to make sure startups get all the help we can get–and it’s leading to higher companies getting off the ground.

But what about investors?  How are we supposed to get better?

Not every potentially good VC previously worked for Fred Wilson and Josh Kopelman.  Not every VC used to get pitched by VC funds for a living and has seen hundreds and hundreds of VC pitch decks.  Yet, even I wished I had more guidance when I was first starting out.

Venture capitalists play an important role in burgeoning ecosystems.  They cross pollinate ideas–meeting with lots of different types of stakeholders.  They’re the only ones whose job it is to meet with the founders, lawyers, technologists, corp dev folks, media, professors, and talent all at the some time, not just to look for deal flow but to improve the quality of the ecosystem these companies are going into.  Their guidance and network can also make these companies better.  So if you want to make better ecosystems, and better startups, doesn’t it stand to reason that you could help the situation by making better VCs?

So what about a Techstars-like program for new VCs?  I’d love to be able to have Jim Breyer as my accelorator mentor now that has stepped away from the Accel day to day.  In fact, there are lots of VC partners that are winding down their roles that have had very successful careers–where is their knowledge going?  How can we leverage them to help create the next generation of VCs?

I’d love to be part of a program where the best VCs come in and share their knowledge on how they did their jobs and lessons learned.  In particular, I’m always trying to improve as a board member, but their aren’t any programs or classes for that.

Just like a startup accelorator, a VC program would also really help on the fundraising side.  There are lots of people who like working with VCs when they’re small and still hungry to build up a name for themselves.  Aggregating these types of fund investors would make fundraising a lot easier.  Maybe the program could even have a funding basket–they’ll get you your first million bucks in your first $ 7mm fund.  In all liklihood, if you doled out a few million to first time funds that were being mentored by the best in the business, I’d venture to say your return might be pretty darn good.  You certainly wouldn’t lose too much of your money, since these are diversified pools.

A program like these could help you work on your strategy and help get you up and running quickly on shared backend tools as well.   

I certainly would have signed up for it.  I still would.  There are a few programs out there like Kaufmann and InSite that get you exposure to the VC world through mentorship, but you join those programs and go work for other people.  What I’m talking about is how to get mentorship to launch and run my own fund.

All of these people in my inbox who want to get into VC need to go raise $ 10mm of institutional capital to fund 10 VCs over the next two years in a VC accelorator program.  It would be a great platform to get to know everyone in the business and learn the trade.

 

Recent Shark Tank contestant infuses some ‘sweet’ innovation in his product that seeks to replace soda and sports beverages.

Here are two contrasting startup stories I’ve seen firsthand.

With one company, a founder and his super inspirational, creative, and established buddy hatch a plan to build a very strong content brand that serves as a platform for a lot of diverse revenue streams–events, ecommerce, advertising.  You could think of it as a spin on Thrillist.  With the author staying close as an advisor, they build a real, cashflow positive business and start to think about where they could go with some outside capital.  

One of the big opportunities for them is audience development–driving event attendees to the content, events to the readers, and doing some low-hanging fruit upgrades to their social strategy.  They find a kick ass, experienced content person to advise them for six months and help them build out a team around this.

The fundraising will be for that content team, additional developers, and salespeople to leverage the unique brand they’ve built.  Nice, tight story that makes sense.  I certainly would have wanted to be an angel investor in Thrillist at the time.

The second startup came to me from a founder of a company that I only found out later wasn’t fulltime.  The first pitch I got was from someone who didn’t intend on staying with the business as an employee.  It’s actually the first time that’s ever happened to me, so I honestly never thought to ask.  Everyone I’ve ever gotten pitched from can’t wait to quit their other jobs to work on what’s being pitched.  When I found out, I was super disappointed–not because this person was even the right person for the business–but because I liked the first person I met, and then had to mentally extract him from the story arc of this business.

That wasn’t the only stumble in the business.  The team told investors they were hiring a C-level employee, and, upon diligence, it turned out that the person didn’t want the job.  Not only that, but they actually took that potential hire to a fundraising meeting with a VC–a VC that was interviewing this candidate for another position the next day.

[facepalm]

On top of all this, there’s never been a really tight story about goals and resources around the funding–exactly what the next five hires will be, etc.

Here’s the interesting thing:

It’s the same company.  

Neither one is a false account, but in the latter situation, the team pitched at an awkward moment and were super transparent about how the sausage was being made.

Every startup has been in flux at one point or another as to founder roles, key hires, and plans.  Not everyone who has ever been around at the start of the company is the right person to move forward.  These things are nothing new.

What you have to be careful of is how the story appears to investors.  Are you hitting the fundraising trail at the right moment where you’ve got your plan together, team in place, and know where you’re going?

Even if you pitch super early–it’s totally fine to tell an investor you have some key open questions, and then come back when you’ve got them solved.  That’s often how relationships are being built.

It’s that awkward middle phase–where you’re trying out a bunch of stuff, seeing what sticks, that you want to be careful about story arc.  Sometimes you meet an amazing person who has no intention of ever being fulltime on anything.  You don’t want to tell investors you’re trying to get this person and then have to tell them you failed.  Hiring a consultant who always intends to be a consultant isn’t a failure.  Maybe you thought you could snag them, but still, this person could be great for a short stint and a real plus for the company.  How is that story being told?  How is the story of how the founders are figuring out their roles being told?  

I’m a big fan of transparency, but if you’re going to go far and wide on a pitch, organizing your story is key.  It’s a bit like inviting friends to your apartment for the first time.  We all know that our places can be in various states of disarray at times–but that doesn’t mean that if you know you have guests, you shouldn’t throw your dirty socks in the hamper and wipe off the counter.  

I still feel like it’s never too early to talk to an investor to get feedback, but before you do, think about how your company came together.  Think about story arc.  What’s the truthful, transparent account of what’s going on that shows our best times ahead of us.  Otherwise, you’re just starting a game of Jenga and asking an investor to take out the bottom piece.  

I’m still very much in talks with this company, helping working through the story now that I know what’s up–but I’ll admit to experiencing some mental pain experiencing the story in mid-flux and development.  

As a 21-year-old business novice, Lauren Morenz found meaning in her job as a Fetch! Pet Care franchisee.

As a tobacco outlet owner, Nathan Renschler saw the industry moving towards e-cigarettes, or vaping, and followed the growing trend.