I have a great talk with Casey Van Maanen is a Senior Analyst at LOI Venture, an early stage venture capital fund focused on young entrepreneurs in British Columbia. He has experience in venture capital, finance, and business management through roles at different funds.
"It's never easy, but having grit and resilience is key." — Casey Van Maanen
Here are my 3 key takeaways from the conversation with Casey:
* Be transparent and provide actionable feedback in rejection emails to founders
* Clearly explain reasons for declining a deal and provide constructive feedback entrepreneurs can learn from.
* Maintain good relationships.
* Build a strong founder-investor relationship post-investment
* Regular communication through progress updates builds trust and keeps investors informed on key traction metrics, product launches, team changes etc.
* Tailor your fundraising approach (for startup founders)
* Target investors strategically in your space, craft a tight pitch deck, and focus on volume when fundraising.
* Leverage networks like accelerators too.
He also talked about how the rejection process works. Here are my 3 key notes:
* Provide clear and transparent feedback in rejection emails explaining why you declined the deal. Don't leave founders guessing.
* Advise founders not to take rejections personally. It's often not a reflection on them or the business itself.
* Encourage founders to listen to feedback objectively, strengthen their pitch, and persist through inevitable rejections. Grit and resilience are critical.
"One of the red flags that we will identify or that we've seen is a lack of transparency." —Casey Van Maanen
After they've made an investment, they expect founders to provide regular progress updates, ideally on a monthly or quarterly basis. This allows them to stay current on key traction metrics, new hires, product updates, and any other meaningful developments.
As an investor, some of the key things Casey wants to be informed about include:
* Traction metrics like new customers, revenue growth, engagement stats etc. These demonstrate business progress.
* Personnel changes like new key hires. This shows strengthening of the team.
* Product launches or new feature releases. This indicates product momentum.
* Any major partnerships or business development updates. This validates external belief in the company.
* Changes to business/revenue model if any. Understanding pivots.
* High level insight into burn rate/cash position. Allows assessing capital needs.
In terms of frequency, monthly founder update emails are ideal but Casey understands bandwidth can be constrained. Quarterly also works well. They like having regular touch-points beyond just board meetings.
The goal is not to micro-manage but rather stay abreast of major progress and issues. Founders know their business best so they trust their judgment while providing guidance and support where possible. Clear communication keeps the relationship strong.
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