Photo credit: Nik Macmillan.
This is a five-part series by Clement Vouillon with help from those at Point Nine Capital.
Here’s the outline for our series:
- Part 1: Before working with VCs
- Part 2: Preparing your fundraising
- Part 3: First contact and assessment phase
- Part 4: From term sheet to signed deal
- Part 5: Post-investment
Now that you’ve submitted your pitch deck, there are three possible scenarios:
- They tell you, “No, we’re not interested.”
- They tell you, “Thanks. We’re looking at your company.”
- You don’t receive any answer.
The 2 minute TL;DR video
What happens during the assessment phase?
Deal assessment
The deal evaluation process can vary significantly between funds, but it often looks like this:
- The founders submit their pitch deck (cold or warm).
- An analyst/associate/principal checks whether the deal is in line with the firm’s investment scope and thesis.
- If the startup looks promising, the VC will start discussing it with the rest of the investment team and write a deal memo to dive deeper into the opportunity. If it’s not promising, they’ll pass.
- At this stage, VCs usually have multiple discussions with the founders, existing customers, or fellow investors.
- Once they have enough information, they’ll decide whether to invest or not. It often happens during investment committee meetings.
Again, this is a very general framework.
The “hot or not” framework
No, we’re not interested
We’re looking at your company
You don’t receive an answer
