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  • Chronicles of The “Intelligent” Investors

    Nov
    04
    posted by Sneha Menon on Wednesday, November 4, 2009 at 3:04pm Categories: Blog

    Dr. EvilRecently at the e27 eChelon event, there was a panel on “Angels Vs Startups” which brought out some interesting nuggets of wisdom from both sides of the entrepreneurial spectrum. It was very interesting to note that Angels are not usually served the brickbats reserved for the VC’s by the entrepreneurs. Paul Graham in his recent article on “What startups are really like” talks about how most investors are clueless, where he mentions that “The reason VCs seem formidable is that it’s their profession to. You get to be a VC by convincing asset managers to trust you with hundreds of millions of dollars. How do you do that? You have to seem confident, and you have to seem like you understand technology.”

    Now, If you’ve been in the startup business for long enough, been to various product pitches, have experience in pitching your product to the different VC’s out there, you would know one thing for sure: It’s not a very pleasant experience to deal with them. Please keep in mind that am not painting everyone with the same brush here.

    As with any business, not everyone makes perfect decisions, due diligence doesn’t work in most cases and not every one has good foresight. Talking about foresight, the first thing that comes to my mind is the infamous Michael Dell’s quote on what he would do if were the Apple CEO: “What would I do? I’d shut it down and give the money back to the shareholders”

    Clearly, Michael Dell is a great businessman and Investor and even he is capable of making such blasphemous statements, so how can some of our very own local investors stay behind. So here’s a list of some blooper moments from some of the investors here, experienced by our very own local entrepreneurs.

    - One of the judges (an investor) at a famous business plan competition asks the contestant what stage is the product prototype in, and the contestants says it’s in the beta stage, with the investor later asking when can they come out with the alpha version of it!

    - “It’s not web 2.0 enough” – for a hardware-based product

    - On social media: “This whole social media thing is making me think again and I don’t want to. I will lose my job.”

    - At one of the Idea Pitching sessions, where the product is a wireless streaming service, an investor asks a genuine question about the customer segments “What if am in a jungle in Africa?” erm..well certainly the answer to that would be forget about streaming, you will be eaten alive by the animals before you can even enjoy a meal!

    - Well, even-though this incident didn’t take place with an Investor, it’s a funny incident that happened to a startup with a venture advisor, who among various things used geomancy theories to help counter negative forces before pitching to an investor. Now that’s some good advice!

    Names of the startups and the people involved are taken out for obvious reasons, but trust us, all these stories are from actual entrepreneurs who pitched to VCs. Well if you’ve had your share of such funny moments, feel free to comment on this space. And since we don’t want to seem biased, watch out for the next article on entrepreneur bloopers from the investor’s perspective ;)


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