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How not to approach an investor

61 pointsby RyanGWU82almost 17 years ago

11 comments

raganwaldalmost 17 years ago
Speaking for myself, I don't really think the story is about a bad pitch. Business is business, you sell your company any way you like, and people buy or they don't buy. We may laugh at the false bravado, but we are probably laughing at the hard-sell penny stock promoters while they are making millions.<p>Any way, I think this story is really about how to burn a referral source. IMO, if you are approaching a VC directly, you use any pitch you want and I say good for you. But if I refer you to a VC, I want you to think very hard about what your pitch says about ME before you make it.<p>I think that is a very serious matter, and that is the issue I have with the anonymized founders in the story. They clearly did not consider what their referral source would have to say about being associated with their pitch.
motokoalmost 17 years ago
Businesses that make $180MM profit in 9 months from a $10MM investment:<p>- Terrorism<p>- Ransoming the children of a business tycoon<p>- A web 2.0 youtube-like social network mashup
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raganwaldalmost 17 years ago
Rick is a class act, and just technical enogh to be dangerous... especially to founders who sling buzzwords without the least idea what they are really saying.<p>I couldn't resist posting one his best:<p><a href="http://news.ycombinator.com/item?id=223021" rel="nofollow">http://news.ycombinator.com/item?id=223021</a>
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huhtenbergalmost 17 years ago
This is known as a "Fax Attack" method of negotiating a car purchase. Who would've thought it wouldn't work for securing company funding. Duh :)<p>(edit) Here's an example - <a href="http://www.fool.com/car/car12.htm" rel="nofollow">http://www.fool.com/car/car12.htm</a>
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pxlpshralmost 17 years ago
That's hilarious. Terribly played, grossly over-confident and naive expectations. It reminds me of the bad contestants on American Inventor, the tv series.<p>/<i>scratches head with an eye closed</i>
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tstegartalmost 17 years ago
It comes off as more a scam than a real request for funding. "How do you know the tooth fairy isn't some crazy glue-sniffer. 'Buildin' model air planes,' he tells them. Well I'm not buying it. He sneaks into your house once, thats all it takes. Next thing you know you got money missing off your dresser drawer and your daughter's knocked up."
vakselalmost 17 years ago
I wouldn't mind knowing what type of funding this guy was looking for. The hilarity factor would be multiplied if this was for a seed stage company
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danteembermagealmost 17 years ago
Isn't this an exploding term sheet only reverse the typical?
markbaoalmost 17 years ago
<i>"Be careful out there!"</i>
edw519almost 17 years ago
wtf - that's even better than Michael Corleone's startup...<p><i>Senator...you can have my answer now if you'd like. My offer is this. Nothing...not even the thousand dollars for the Gaming Commission, which I'd appreciate if you would put up personally.</i><p>- Godfather Part II
markmalmost 17 years ago
It takes a certain level of courage to ask someone for money. And whoever this is put on a false sense of bravado and yes he got burned. But it should also take some self restraint to not post this crap on your blog, especially if you're a VC.
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