For some reason folks in tech, particularly investors, have trouble saying NO.
Typically the fear manifests itself in not even bothering to reply. After a number of seemingly positive interactions, the replies just stop.
Saying NO, whether to a potential investment or potential hire or current employee or a family member or a friend, is a just basic respect and courage.
Saying NO, and briefly explaining why NOT, is the right thing to do.
Instead of pretending like NO will hurt the relationship, lets face it, a direct NO actually creates clarity, respect and improves our relationships with each other.
I just finished raising the next Techstars NYC fund. This fund is going to invest in the next four classes of Techstars NYC companies, starting with the Winter 2017 class.
The process only took me about a month. Of course I had an unfair advantage, because of the support of current LPs, and strong reputation of our program.
Yet, during the brief period of time that I was out on the market fundraising, I was back in the founders’ shoes. I put together a few slides, got feedback from my mentors, created a pipeline of potential investors, and methodically reached out to existing, and new prospective LPs.
What I appreciated the most during the process is when people gave me a quick, or not so quick, but a clear NO.
Sorry, Alex, not a fit right now because I don’t have the liquidity. Sorry, Alex, my fund wouldn’t allow me to invest in another fund. Sorry, Alex, we just bought a house and my money is tied up. Sorry, Alex, I prefer to invest directly.
I love getting a clear NO.
Don’t get me wrong, I love getting a YES a lot more, but NO is the best thing after a YES.
The worst conversations are the ones that are a MAYBE. The worst conversations are the ones that hang in the air. The worst conversations go silent after a few follow ups. The worst conversations start with strong momentum, then stall, and run our of air.
I can’t stand a MAYBE, and thats why, if someone didn’t respond after two follow-up
s I moved them into a PASS category. I have strength and courage to face the reality – it is most likely a PASS.
When founders are fundraising they are full of hope, and pretend like NO is actually a MAYBE. Oh yeah, I am still talking to so and so, and while I’ve not heard back in a few weeks, but they’ve not said NO to me. Your gut knows it is a NO, but you pretend like it is a MAYBE.
Lets stop pretending, and save ourselves time.
Instead of obsessing over a MAYBE, just move on. Start a bunch of new conversations. Fill up the top of the funnel. Talk to more and more people to maximize your chances. Be in control, and to get to a YES.
The route to a YES is paved with many NOs.
Knowing that and driving every single conversation to clarity, even if it is a NO, is how you can get the job done.
Now back to saying NO to others. Please do it. As a founder, you have an opportunity to start fixing this dysfunctional part of our tech culture. Don’t pass a MAYBE onto others. Have strength, courage and respect to say NO, when it is really NO.
This post was originally published on my blog, alexiskold.net. Visit my blog for more posts on startups and fundraising and follow me on twitter @alexiskold.
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