from Hacker News

Investors won't give you the real reason they are passing on your startup

by bx376 on 5/3/24, 6:52 AM with 27 comments

• by barrenko on 5/3/24, 6:57 PM

  The significant other won't tell you why they cheat on you, the employer won't tell you why they picked that other guy / gal. Your grandma doesn't know why you're her favorite grandkid.

• by bawolff on 5/4/24, 1:20 AM

  In other words - the real reason people reject you is because they don't like you.

  That's true of most things in life.

• by erichmond on 5/3/24, 9:25 PM

  The interesting part here is that it's actually a two-sided marketplace. Most investors aren't "impressive" either, and thus they'll often not be able to get into the best deals because they have no value add.

• by xyst on 5/4/24, 2:36 PM

  There’s something wrong when you are expected to be a “100x” or “1000x” roi as a startup.

  So many good ideas and companies go bust once they accept that vulture capital. End up trying to do too much in order to capture a wider market. Unfortunately it ends in a crash and burn once the VC expectations are not met and money dries up.

• by theideaofcoffee on 5/3/24, 9:12 PM

  It’s like job hunting in a way too, they can reject you, but you’re also interviewing them for their resources and fit too. Why shouldn’t I just ignore them if they ignore me? If we do happen to grow to a point where they’ll come crawling back begging to be part of thE nExT rOUnd, isn’t that a signal that I shouldn’t even bother? They did tip their hand first...

  I don’t know why I would give them the time of day, same as I would anywhere that rejected me for a job but later had a change of heart.

• by rootsudo on 5/3/24, 8:06 PM

  Of course, that is because in case you are a unicorn on next pass they didn’t throw you under the bus. So you’ll chat with them and like them.

  It’s the expression: “if you don’t have anything nice to say, don’t say anything at all.”

  The Silicon Valley tv series has this great when Eric Baurich goes from begging to being mean and that’s is a great example of this.

  Same for anything, employment, dating, friends, etc.

• by contingencies on 5/3/24, 9:27 PM

  <opine>Team is mostly BS. The chances that even a really good investor, who is not actually in the game, can accurately determine an early stage startup's commercial trajectory by magically intuiting from highly condensed summaries of multiple people's multiple decades of nuanced experience, is near zero. Yes, there is insight to be had there, especially at the pointy end of 80/20, but there are far more significant factors in most cases. Long term VCs will tend to overstate the importance of character due to survivor bias (ie. the successful follow-ons are the only founders they really get to know).

  IMHO most early stage investment is made based on hunches and hand-waving after doing generalist macro assessments of particular industries or trends. Frequently, faddish. GP's will often do this, raise a fund around it, then associates are sent out to get deal-flow and execute. Many startups will be get selected from an available pool with the established investment theme. This capital is largely sacrificial, and high miss rates are expected.

  Where things get serious at the personal level is in the mid to later stages where you start to see bigger figures being moved about and investors want a shepherd for their capital who has proven stable and long haul capable - things like the capacity not to suddenly live beyond their means, lose focus, drop it all and go to Vegas, crash and burn at HR management, or break down at the first signs of difficulty. That said, you also get mechanics being added like tranched deployment and fiscal/management oversight (eg. board seats) which are highly effective at mitigating risk even in a low-trust scenario. Most VCs are early stage and never play at this level.

  To put it bluntly: early stage is mostly noise. Mid to later stage, if they want the deal, they'll make it happen. It's your job to be so damn good they can't help themselves.</opine>

• by fellowniusmonk on 5/3/24, 6:46 PM

  tldr. Your team isn't impressive enough.