It has recently come to my attention that you are making some rookie mistakes raising capital. I’m told some of these have been expensive mistakes, sucking hundreds to thousands to tens of thousands of dollars out of your moth-eaten pockets. As it is in the best interest of the entrepreneurial ecosystem for all parties to be educated, I am writing to you today to address one error you are committing.
That error is the sin of paying to pitch to investors. Please, for the love of all that is good in the world, just stop doing it. It rewards shitty behavior. It props up lame investors. It makes you look like a fool. It propagates bad behavior throughout the ecosystem.
If you really have something cool to pitch, I promise you that investors really really want to hear from you. Trust me. Pick up the phone and make some calls. Talk to your mentors and co-workers and professors and friends and family and make some connections. Do your research. Get in touch with the right investors. You don’t have to pay to get a meeting.
In fact, if you walk up to an investor and tell them “Hi, my name is Bob and I just paid thousands of dollars to pitch to you!” I promise you the investor is going to think: “Wow. Bob’s a moron. I’m sure as shit never gonna fund Bob.”
If you want to pitch investors, make a connection to them. In the world of LinkedIn, Facebook, Twitter, and more (and don’t forget the old standby: the telephone!) anybody with a pulse and useful brain cells should be able to make connections to meaningful investment groups. A few emails and calls are a LOT cheaper than some of the whack things I see going on out there. Let’s stop the insanity.
Of course it is a free country. If you must flush your money down the toilet, then that is absolutely your prerogative. Just don’t expect caviar and wine to spew out when the toilet backs up.