5 More Things VCs Wish Startup Founders Knew


We did a previous dose on 5 things investors wish startups knew. Go here if you missed it. Well, that didn’t cover everything. Managing Partner, Steve Barsh, sat down to give us 5 MORE things investors wish startups knew. Keep reading for some more of the most common mistakes startups make when pitching and for Steve’s tips on how to fix them.


1. Share your unique insight

What did you discover that sets you apart from other startups? Investors want to understand why you’re going left when everyone else is going right. What’s the unique insight you’ve come across that’s driven the core of your business? 

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Investors want to hear, “Our unique insight is ________”… in your pitch


2. VCs are judging your ability to sell

If you are running a B2B company, investors know that you need to “sell” to potential early adopters. It doesn’t matter whether your business model is B2B, B2C, or any other model, you still need to “sell to people” to get your key hires on board, critical partnerships and suppliers, and maybe even a deal from your landlord. To get your company off the ground, you’ll need to sell people on your vision, get them excited, and help them overcome their concerns regarding the risk of getting involved. 

On that note, when you’re raising, you’re selling. Do not be mistaken. So, of course, investors are judging your ability to sell. They’re judging your ability to get your audience excited, bought in, and closed. They need to know that you’ll be able to identify obstacles to sales and get deals done. The Dreamit team has said it before, raising money from a VC is a lot like sales. The only difference lies in WHAT you are selling. Rather than selling a product or service, you’re selling equity, or debt, in your company. If you can’t “sell” or “trial close” investors, they’ll have doubts concerning your ability to do it with customers, partners, or early team members.

“When you’re raising you’re selling.”

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Not comfortable selling? Improve your selling skills by studying the many books and videos available on that very skill.  Or, get someone else to be the primary pitcher (e.g co-founder). 

Here is our tip to trial closing an investor. End your pitch with something along the lines of, “So, is this something you feel you would like to get behind?” If they hesitate, respond with, “Okay, can you tell me the 2 or 3 things you would need to see in order to invest?” This shows that you’re comfortable at “trial closing” and the type of founder who actively looks for the “obstacles to sale.” It set you miles apart from other founders and quickly demonstrate your sales skills.


3. When VCs invest they are “swinging for the fences”

If VCs are partnering with a founder and placing a big bet, in the long term, they are looking for a very large return. 

“Don’t forget, this a high-risk, high-reward business.”

When prospective investors are speaking with you, they’re trying to understand if you’re swinging for the fences too. They don’t just want to hear about this round and how you are going to get to $50K MRR, or a $3M ARR, that’s only hitting a single or a double. They want to hear about your big vision and understand what the business will look like in 3-5 years. It’s key for investors to understand how the world will change now that you’re in it. How are you going to build a big, impactful company that “sucks the air out of the room” for all the other players in the market? So towards the end of your pitch, end on a crescendo. Say something like, “We hope you want to invest and join us on our journey. This is just the beginning. Our vision is that we will dominate/own/monopolize/become the verb for ______ customers.”


4. VCs want to figure out if you are really in this for the long haul

Are you going to stick around to achieve that aforementioned mission? Building startups is really exciting, but also really difficult. It takes a lot of stamina. This is a marathon, not a sprint. Founders that are in it for the long haul are missionaries, as opposed to mercenaries looking for a quick exit. investors are trying to figure out if you’re going to stay with this one for the next 5-10 years, despite the ups and downs that may come along the way. 

On that note, they’re trying to see if there’s an innate passion that will keep you going when things inevitably get difficult. Do you have a personal connection to the problem that will keep you going? Do you have a competitive streak driving you to win? Investors need to know why you started this company in the first place, what motivates you, and how you will become an unstoppable force. 


5. Answer questions directly and succinctly

This has been mentioned in multiple doses so it may not come across as a surprise, but when investors ask a question, founders usually dance around the answer. Or, they’ll BS investors because they don’t have a great answer. 

Steve advises that you (not a surprise) listen to the question. Try to understand what the investor is asking and why they may ask that question before you answer. Give direct, succinct answers, and then elaborate as needed. Be truthful and get to the point.

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Steve recommends delivering “Twitter-length” answers and waiting to see if the investors would like you to elaborate further.

Don’t be afraid to admit when you don’t have an answer but realize that if you do this, investors may at least ask you to explain how you would approach an issue. Take anything you can’t answer as an action item, and follow up in a timely manner.


Those are the 5 MORE things VCs wish startup founders knew before pitching. There are a lot more investors like Steve could cover, but that’s why we’ve started the Dreamit Dose series! Stay tuned for our upcoming blog posts for more tips.


By Alana Hill, Securetech Associate at Dreamit Ventures

Book Office Hours with the Securetech team.

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Learn more about Dreamit Securetech, a growth-focused program for cybersecurity, fraud, compliance, and physical security startups.

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