Preparing For a VC Meeting: 10 Questions To Ask a Venture Capitalist

Written by Dave Lavinsky

Venture Capitalists Investing Meeting

You’ve finally got a meeting with a venture capitalist (VC) lined up. Congratulations! However, before you get too excited, it’s important to remember that a venture capital meeting is very different from a regular business meeting. Therefore, you will need to prepare accordingly in order to make the most of your time with the venture capitalists. This includes preparing your pitch for potential investors as well as crafting questions to help you determine if this is a good fit for your company. This guide will provide you with tips and tricks for preparing for a VC meeting.

 

Tips For Preparing For A VC Meeting

As with all meetings, preparation is essential. But what do you need to do to prepare for a VC meeting with portfolio companies specifically? Below are a few tips:

Know Your Goals

Before you even start preparing your pitch or rehearsal questions, it is important to take a step back and think about what your goals for the meeting are. What do you hope to achieve? Are you looking for funding? Introductions to other VCs or industry experts? Feedback on your company idea? Do you want a managing partner, or a more silent investor? By knowing your goals, you can tailor your pitch and questions accordingly.

Craft Your Business Plan

While you may not need to go into great detail about your business plan during the meeting, it is important to have a solid understanding of your business model and how it will make money. This will help you answer questions from the VCs and show that you are serious about your business. Venture Capitalists are hesitant to supply investment capital to early stage startups, so be sure to document all of growth your startup has made. 

Create A Pitch Deck

A pitch deck is a slide presentation that gives an overview of your company to the potential investor. It is important to have a well-designed pitch deck ready to go, as this will be one of the first things the potential VC will ask for. Make sure your pitch deck is clear, concise, and tells a story. You want to take your VC through the sales funnel, with the end goal being having them become investors.

Rehearse Your Pitch

Once you have your pitch deck prepared, it’s time to start practicing. This includes both your elevator pitch (a short, 1-2 minute overview of your business) and your longer pitch (5-10 minutes). Make sure you are comfortable with both, as you never know how much time you will have during the first meeting with potential VCs.

Ask Them Questions

While it may seem like the VCs will be doing all of the talking, it is important that you come prepared with questions as well. This not only shows that you are interested in working with them, but also allows you to get more information about their investment style and process. Below are some questions to ask your VC and determine if they are a good fit for your business.
 

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10 Questions To Ask A Venture Capitalist

1. Why Are You Interested In My Business?

First off, you want to know why the VC is interested in your business. Is it because they see potential in the industry? The product? The team? This will give you some insight into their investment strategy and what strengths they see in your business.

2. What Is Your Approach To Investing?

This question will help you understand the VC’s investment strategy. Are they looking for companies that are already generating revenue? Or are they willing to take more of a risk on a business that is still in the early stages? Knowing this will help you determine if they are a good fit for your business.

3. What Can You Offer Besides Capital?

In addition to money, VCs can offer a lot of valuable resources to help grow your business. These may include access to their networks, industry expertise, and connections to other VCs. This is an important question to ask, as it will help you understand what value they can bring to your business.

4. What Is Your Due Diligence Process?

Due diligence is the process of investigating a potential investment. This includes looking at the business’s financials, the management team, the competitive landscape, and more. Asking about their due diligence process will give you some insight into how they evaluate investments and what criteria they use.

5. Will You Join My Board?

If the VC is interested in investing in your company, they may also want to join your board of directors. This question will help you understand their level of involvement and what role they would play in your business.

6. Would You Buy My Product/Service? If Not, Why?

This is a great question to ask, as it will give you some feedback on your product or service. If the VC is not interested in using your product, it may be an indication that there is something wrong with it. However, if they are interested in using it, it shows that they see potential in the business. Their feedback will also show you the flaws in your product and how you can improve it.

7. Why Do You Think My Business Will Be Successful?

Asking the VC why they think your business will be successful is a great way to get some feedback on your business model. It will also give you an idea of their investment strategy and what they see as the key drivers of success for your business.

8. Why Do You Think My Business Will Fail?

If the VC doesn’t seem confident in your business, this is a great question to ask. It will help you understand their concerns and what they think are the risks of investing in your business. This information can be valuable in addressing these issues and alleviating their concerns.

9. What Do You Expect From Us?

VCs do not provide charity money; they are looking for a return on their investment. This question will help you understand what they expect from the business in terms of financial return, growth, and exit strategy. Knowing this information will help you align your goals with theirs and ensure that you are both on the same page.

10. What Is Your Timeline For Making A Decision?

Finding a VC can be a long and difficult process. This question will help you understand the VC’s timeline for making a decision. This information can be valuable in determining how soon you need to have everything in place and when you can expect to hear back from them.

When preparing to meet with a VC, it is important to know your goals, craft a strong business plan, and create a pitch deck that will capture their attention. It is also important to rehearse your pitch and ask them questions. Asking the right questions can help you understand the VC’s investment strategy, what they can offer besides capital, and what their expectations are. Knowing this information will help you determine if they are a good fit for your business and can help it succeed.

 

Finish Your VC Business Plan in 1 Day!

Don’t you wish there was a faster, easier way to finish your business plan?

And know it’s in the exact format that venture capitalists want?

With Growthink’s Ultimate Business Plan Template, you can finish your plan in just 8 hours or less!

Click here to finish your VC business plan today.

 

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