The 7 Things We Hate Most About Startup Selection
Where is your next deal going to come from?
There are countless startups looking for investors, and they’ll drive you crazy with their propositions if you don’t take control of the process. There are a number of things that we hate about startup selection — and when you have a better deal flow in place, it can automate many of the tasks. Just imagine what you could accomplish if you don’t have to deal with all of the headaches along the way. There are certainly things we would change.
We Would Stop Receiving Spam Emails
The moment that people find out that you’re an accelerator, VC, or anyone else willing to give out money, the spam emails will start up. This will include those claiming to be Nigerian princes along with everyone else. To avoid spam emails, you can make sure that you have a form that everyone has to go through. Spammers want to send out mass emails, they don’t want to fill out forms. It can be an added layer of filtration to avoid falling prey to certain scams. And, should you not want to host a form because it might prevent some founders from reaching out to you, a system that detects these spam emails would be helpful.
We Would Stop Receiving Proposals That Don’t Fit To Our Investment Criteria
Often, a ton of proposals will come in that don’t meet our criteria. Even if it’s a great opportunity, it’s the wrong industry, too much money, or something else. Rather than getting the proposal into your flow, it’s best to stop the proposal from coming in at all. It saves you time and ensures that the startup doesn’t get their hopes up. You can create a form that lists out your investment criteria so that if a proposal can’t meet it, you can sort it out. Alternatively, a pitchdeck parser that detects investment criteria automatically from pitchdecks can save a lot of work.
We Would Ditch Manual Data Entry
The data entry can be time-consuming when you start to get a large number of proposals coming through. Each time you have to manually enter data from a pitchdeck into the CRM system, it can take hours. However, it’s a necessary step in the process to ensure that you have collected the data so that you can conduct your analysis. This is one of those things that you can automate, ensuring that the data from the form goes directly into your CRM, eliminating almost all data entry on your side of things. It allows you to be more productive so that your entire day isn’t spent dealing with incoming pitches. Even if you don’t want to use a form for fear of founders not filling it out, a pitchdeck parser will extract the data from the email or pitchdeck and submit it to the CRM.
We Would Avoid Communicating with Pushy Founders
Founders can get pushy because they have a vision that they need funding to complete. They want your money, and some of them don’t have the tact to communicate in a friendly way. You can’t spend half of your day talking to founders about why you’re not going to fund them or why you don’t think that the market is going to go in the way that they anticipate. You may want to have a relationship with the founder, still. They may be too early or too late. You might also want to introduce the founder to some of your investor friends — or even have the founder introduce you to some of their founder friends. Either way, there’s a way to say “thank you, but no thank you” while keeping a relationship in place.
We Would Get Help with Scheduling Pitches
Scheduling pitches is more than just a little bit of a headache. It seems as though every startup has a pitch and they want you to hear it out until the end before you make a decision. However, pitches can take a lot of time to hear, especially when you have to hear from multiple parties in a day. It’s better to eliminate the startups based on their pitchdecks first. Then, after you know that there are a few startups that are worthy of your funds, you can schedule a pitch in order to make your final decisions.
We Would Stop Asking for Missing Data
When startups are asking you for funding, why should you be the one to hunt down the missing data? They may not have provided you with all of the numbers that you need to see. This can involve a lot of follow-up because of needing critical data to make your decision. Rather than asking for the data in stages, it can be requested all at once. They won’t be able to make a pitch until they have provided everything.
We Would Ask for Help with Doing the Research
The research can be a time-consuming task, too. You have to research cap tables, trends within an industry, and all sorts of other things. You may have to spend hours crunching the numbers to see if you’re about to stumble on the next unicorn. It’s research that needs to be done, though, because you want to have data to back up your decisions. Further, you want to make the most of your investments.
What if there was an easier way? It’s easy to acknowledge that there are plenty of things that we hate about startup selection. It’s not so easy to solve all of the problems unless you decide to streamline the intake and begin to use automation tools.
CDF One provides a seamless transition that you can integrate into your existing process. You can screen and evaluate the most relevant startups to determine if they’re right for you or not. It all starts with hosting a questionnaire that startups have to fill out if they want you to provide funding. This eliminates the constant requests that you get throughout the year that have nothing to do with your industry or simply don’t want to provide all of the data that you need.
Current and upcoming investments can be structured inside of a database that provides you with the truth that you need. It allows you to take greater control of the data that is being fed to you without having to do all of the research on your own. Additionally, the key insights that you can pull from the table in the form of convenient graphs and charts can make it easier to digest the information.
Contact us at CDF Technologies GmbH to learn about our software solution that allows you to collect information automatically and structure the deals in such a way that you can make quick and effective decisions.