Some weeks back in my post "Early stage funding – VC or Angel?" I offered to take 30 minute "no harm, no foul" (NHNF) meetings with people who contacted me to pitch their ideas.
After seeing Marc Andreessen's post on his blog today ("…But I don't know any VCs!") about some VCs offering to be contacted by entrepreneurs directly, I thought it would be useful to summarize my reactions and the feedback I've given to the folks with whom I have met through these NHNF meetings.
- Explain the market!!!! Cover these topics - a) the size of the market opportunity, b) the path to the market and c) the real value to the customer – paying or otherwise. This is one area where the NHNF meetings could stand improvement versus the more traditional meetings. Be really explicit about what you are going after, why this is important to your customer and how you are going to reach them.
- Watch the business model and beware of credibility traps – at the risk of overloading this post with links, please "Sanity check your business model!" – This applies to both NHNF as well as traditional meetings. Going through the financial model and the market easily represented the bulk of time in all meetings.
- Some proof of concept is necessary unless you have a long and relevant track record in the same domain as your new idea. A prototype helps… A prototype with some customer validation points REALLY HELPS! If you don't have either then show how you can reach this important milestone on a modest amount of capital.
Overall, the quality of the NHNF meetings stacked up very well compared to meetings I took via the more "traditional" referral route. All of the meetings were time well spent and I learnt something or got something to really make me think from each of them. Thanks to those of you who contacted me so far and I'm still open for NHNF meetings!