VC Checkpoints

I often get asked about how to ‘know” if a VC is right for a particular start up.  There are so many answers to that one, it can be a long conversation.

But here is a fairly good sign you might want to think twice.

I was sharing a call today with a Valley VC. We were going to have a conference call with a start up that is doing some really interesting work, has gotten some revenue already, two people, working out of the garage kind of thing, and very smart.

Call starts.

First words out of  Valley VC:

“Guys, you really need to get a toll-free conference call number so we don’t incur the charges.”

I swear I thought it was some new test. Let’s say something incredibly insane to a shoestring start up and see if the founders can stay cool.   They were serious.  The founder did manage to stay cool (“we’ll look into it”) and actually finish the call.

Eat left arm mixed with ground glass before taking money from those people? Check.

 

Comments

[Zoli Erdos]

Wow, other than being cheap, "Valley VC" is clearly living in the past, if phone costs are still a consideration for him in the age of VOIP...

[Brad Feld]

Get that VC a lifetime account on Skype. Hmm, wait a sec, ...

[Matt]

How much you want to bet that the same "Valley VC" that -- pre-investment -- wants them to shell out cash for dedicated toll-free conference line, would be crawling up their butts every second of the day -- post-investment -- about how the money was being spent?

Honestly, if they're really doing such great work, I hope they can get by without outside investors. Present company (of course, :) ) excluded, they're generally a bigger pain than they're worth.

[TJIC from Technical Video Rental]

It's this kind of craziness that makes me quite happy with our model of self-funding with a second mortgage, working out of a garage, and being cheap with almost everything. We're up to five people, profitable, growing rapidly...and we still have no toll-free conference line.