Getting A No

I had a email conversation with a friend yesterday. He had just been turned down by a venture capital firm on an investment. He was pissed. The VC firm had not acted well in parts of the process. He drafted an email to me that dressed the firm down a bit. And he asked me what I thought.

I told him "Let it go. Don't send the email."

I've been in the venture capital business a long time. I show deals we are invested in to VCs every day. And when they turn us down, I still get pissed. It hurts. How can you not love my kids when I love them so much?

But when you get a no, you have to take it with class. You need to thank the investor for taking a look. You need to keep the relationship intact for the next time you want to raise money. It is hard to take a hit and not hit back. But you have to do it.

I always make myself feel better by saying to myself "this deal is going to be huge and the best revenge will be when they are kicking themselves for saying no." That makes it a lot easier to write that polite reply that you need to write.

#VC & Technology

Comments (Archived):

  1. David Bernick

    Fresh off of an exit that makes me able to be a bit choosy about my next role and being an engineer, I get approached by entrepreneurs often to become a technology partner. Yesterday, after about a week of meeting with an entrepreneur and really trying to understand what it is that he wanted, I decided I wasn’t going to engage in his project. Now he believes in his project and is passionate about it. One of the reasons I didn’t do it is because I didn’t share that passion and didn’t just want to take his money as “work for hire”. I was honest and told him that I didn’t see the business model as a successful one (consumer-facing stuff) and just wasn’t going to be a good partner. He proceeded to call me a slew of names and told me that when this thing is bought by Google, I’ll be sorry. I told him that maybe I just don’t get it and I’d be a poor partner then. He couldn’t understand why anyone would possibly turn this deal down. He told me my assumptions were wrong and this was going to be successful. I just didn’t see it (especially given the lack of experience that he had in startups). I wished him well (and truly meant it), but I could tell he was really upset.After I got off the phone, I called a friend of mine who’s a VC. She said that 90% of the folks deal with the rejection just fine and don’t take it personally. About 10% totally write nasty emails or have nasty confrontations. Passion and business need to mix to make a startup successful. But that also means emotions get more involved than they would in an established business. When I disagree about a business model, I just say that I disagree and leave it at that.

    1. fredwilson

      i’ve been there Davidit is not a pleasant experience

    2. Dave Pinsen

      The entrepreneur was clearly out of line in lashing out at you that way, but I wonder if entrepreneurs are taking rejection harder these days in general because of the weak economy. Maybe in the past, more of them had viable career tracks as employees if their start-up ideas didn’t pan out. But today, with 1 out of 5 of working age men unemployed, and 1 out of 7 Americans in poverty, maybe there’s more pressure on entrepreneurs because there are fewer fall backs for many of them.

    3. Pete

      The founder doesn’t realize you’re doing him a huge favor! There are too many guys in your shoes who don’t share the vision, but make a half-hearted attempt at the idea anyway. Lots of web dev guys have 15 sites running on the side anyway, so why not put a few hours into another one just to see what happens. Months and months go by, wheels are spun, no one is happy, and then it crashes. Who wants that?

    4. Matt A. Myers

      Most people don’t know how to not take things personally, and it’s hard not to without the proper reflection time. It’s hard to let go. It’s hard to learn to slow down and give yourself a bit of recovery time, or do to other tasks while you relax from the situation; I’m not sure if it will get easier per say, but it’s needed experience to learn, and so you can fine-tune or better your pitch/presentation, product and your own person.There really are only two possibilities.1) Someone will understand what you’re saying or see greater possibilities than you do with your idea,2) or they won’t understand it and won’t have interest in it or they have some other kind of conflict – hopefully that they tell you early on before you go on further with even telling them any details.The latter is what I’m most afraid of. I don’t believe most people will be able to execute as well as me, but the anger that comes from those situations isn’t nice. There are also people who are very good at figuring out a path once they hear the end result or hear about a model that is working. People adjust their morales according to the reward or ease of something it seems and convince themselves however they can that no harm will come to them – it’s disheartening at best.

      1. JLM

        There is nothing wrong with taking things personally. Life is pretty damn personal. There is nothing wrong w/ letting your emotions build and bubble over. At the end of the day, we are DRIVEN by emotions.There is something terrribly wrong w/ being churlish and stupid. It is not only not cool but it is also very ineffective.It is like espionage — never let the other guy know what you know.The smartest folks kill their “no”s w/ kindness. Same thank you. Same handwritten note. Same pleasant smile.One of the best pieces of advice I have ever received — Never get mad at the money, it WILL change its mind.I remember being kicked to the curb once by a guy — “…sorry, not looking for any deals in Texas.”Six months later he calls up and says — “Hey, I’m looking at that note you sent me from our visit six months ago. Our current focus is Texas, you got anything we can take a look at?”Do you think I would have gotten that call if I had poked my thumb in his eye, cross chopped his esophogus and broken his nose and driven it into his brain? Sorry, Ranger School. But you know what I mean?”Never get mad at the money, it will change its mind.”

  2. Jestyn

    Fred this is so true!I find it helps to draft the grumpy reply (in a program that can’t send mail!) to get it out of my system, then leave it to the next morning and send the polite one.

    1. fredwilson

      nice trick

      1. Dan

        I had an initial meeting with VC about my idea.. then they called me back (how nice) to tell me that they are not interested. I politely told them (lied to them) that this is OK because I have ****** (major name of company in initial fundings) interested and on my way tomorrow to sign the deal. 2 hours later I had a head guy from that company calling me back with even better offer. Funny part is that I had NEVER to proof that I actually had a second offer on the table :)Those guys are like animals. They trying to catch the best hunt. Most of the time they judge according to their own rules. But sometimes someones else peace of meat taste my startup is working pretty well and we will break even by December this year. VC are very happy AFAIK about investing in this venture.

    2. karen_e

      I do that too, all the time! Draft the grumpy reply. Everything cools down by the next morning, anyway.

  3. RichardF

    Revenge is a dish best served cold.Never worth firing off an email to anyone when you are annoyed with them, ever.

    1. Vinay Pai

      Better yet, “the best revenge is living well”.

  4. CliffElam

    Funny, it never bothered me when they decided not to invest … it bothered me when they didn’t tell me so. I’m fine with “we will be in touch” – I get that, we all have to wash our hair some Saturday nights. I didn’t like it when they would launch some prole recently graduated MBA onto our team to probe for more information when they never intended to do anything but keep Kenny From Princeton busy for a few weeks.-XC

  5. raheeln

    Even if the VC you *really* like rejects you nicely, a no is a NO 😉

  6. Dan Cornish

    When you are selling a product, a service or trying to raise money, you have to expect to get told no all of the time. I can’t tell you how many times I put months into a potential deal and then have a large competitor steal the deal while I was treated very unfairly. Raising money is just another sale or deal. A great sales person knows how to turn a no into “who else do you know,” or realize time to move on. Never burn a bridge, it is a small world.

    1. reece

      nailed it.

    2. jameskupka

      Agreed – our reputations are our means of production!

    3. Pete

      I was just about to write the exact same comment, Dan. Fred’s advice goes for any sale or deal. People make decisions based on a variety of factors, and sometimes business doesn’t go your way. And we’re all people, not business robots. Separate the business decision from the person, and treat people well. Be good in the universe.

  7. reece

    I’ve got to respect the passion of an entrepreneur who wants to claw and fight for the success of their vision…That being said, you can’t cry over every “no.”You CAN go on and ship the next release, get more customers and build a business.Stop griping and JFDI.

    1. Mike

      “Stop griping and JFDI.”I think I might hang that up on my wall.

      1. reece

        ha… awesome.

  8. LIAD

    I used to find myself firing back emotional emails the whole time, whether to investors, employees, journalists or others.I felt steadfast with my point of view or argument and thought proving things and gaining agreement was paramount.i would be determined to win the battle even if it meant beating the opponent into submission and ruining the relationship. Sometimes over trivial and meaningless issues.those days are long gone. i’ve learnt to take things in my stride. there are more important things than just proving you’re right……OM……….

    1. Matt A. Myers

      It’s not worth the time, for any kind of relationship (unless you’re already married or have a new VC daddy or mommy where the relationship is paramount for happiness and success).C’est la vie!(or when you’re in France, you must say “That’s life!”)OM, Shanti

    2. PhilipSugar

      You never can prove you’re right to a buyer.There is nothing more than I hate, then somebody arguing with me over a point where I am the buyer and they are the seller.If I politely say no, that is a very polite response. The more you push after that the more I hate on you.I have to put them on my list of people I never will talk to again. You can NEVER win an argument with a buyer.

  9. William Mougayar

    You said it very well. The same applies for losing a client. You never know where people end-up, when they move from their jobs, when circumstances changes, etc…Taking a long term approach for keeping doors open is a good strategy.

  10. ErikSchwartz

    It has been my (very) painful experience that if a VC does not act well in the investment process you do not want them as shareholders.

    1. LIAD

      have read that kind of thing before.if they’re not decent to you before you get married, how much more so years down the line.

    2. Matt A. Myers

      That’s good to remember.

    3. Dan Cornish


  11. William Mougayar

    If they are saying No, the match is not there anyways, so why worry about it. They are saying No to the deal, not to you as a person or a firm, and as you said, that’s the best way to take it.

  12. 110j

    Smart advice,Should be the rule for every “NO” in our life not only in the business.

  13. Dan Ramsden

    I wonder if the entrepreneur community is starting to get a little bit spoiled… what with all of those colluding super-angels doing 500 deals a day and what not. I’m kidding… sort of…This is another (very real) downside to a bubble: expectations that are more painful when deflated.

  14. jameskupka

    Type the angry email, sure, it’s good for you to get it out. Always delete it, unsent. If actual follow-up is necessary… do it with a level head!

  15. Iain Darroch

    Saying no is one of the less enjoyable aspects of investing. Entrepreneurs need to be aware from the outset that a rejection from an investor is more likely than a yes. That said, the investor should still try their best to be polite and provide a brief rationale where possible. If an entrepreneur replies in an aggressive manner then it probably shows the investor made a good decision. How would that entrepreneur take advice, respond to customers saying no etc? It can also hurt for the investor to say no. I’ve had scenarios, where I’ve liked an opportunity but others have not and therefore had to reject it. Not nice when it goes on to do well!

  16. John Frankel

    “No” is “No” and I find myself saying it almost every day. It is never a good feeling and I would love to say “Yes” to everyone, but that is not what I am charged to do. The key issue, for me, is how you say “No”. I actually try and explain why the deal is not a good fit, what I think the entrepreneur should think about, give any advice I can from my perspective (reading the docs and a 60 minute conversation). A disingenuous “Come back when you have traction” is something that I avoid as this is often just a cop out.Being an entrepreneur is tough. It takes gumption. It often requires one to take a tough path in life. I just try to be helpful, respectful, civil. Why wouldn’t one.

    1. JLM

      Well played,

  17. Gerald Buckley

    I’ve yet to read the nutritional information on this steady diet of humble pie we founders subsist on. But I do know this: * It’s an acquired taste.* It builds character and is good for the soul.* The antidote for the bitter after-taste is found at Shake Shack -or- the first reasonable Term Sheet. Whichever comes first. :)I kissed a LOT of Shake Shack before getting the right Term Sheet. And I’ll happily do it again one day.PS – Is it just me or do founders graduate from this diet of Humble Pie to TUMS fairly quickly? The only constant seems to be Shake Shack.

    1. fredwilson

      that is a fun comment Geraldnicely done

      1. Tereza

        Relating a comment to food, especially Shake Shack, is a clever and devious move. Gerald shows great promise as a potential high-scoring AVC regular.Does he have the guts?Last week, my friend reminded me of the usefulness of the Seven Deadly Sins framework. They are a time-tested magnet for human attention and intrigue.Generally speaking, I’d suggest every comment should relate to at least one of the Seven Deadly Sins. The more, the better.JLM is an Olympic-caliber athlete at this.If anyone needs a reminder, they are:1. pride2. envy3. gluttony (A+ for creativity, Gerald!)4. lust5. anger6. greed7. slothI’d bet a burger at Shake Shack that AVC comment volume tracks closely to the breadth and depth to which a post touches on the body of emotion that are the Seven Deadly Sins.Anyone want to run that analysis?

        1. Fernando Gutierrez

          Hey Tereza, I love that framework! I don’t feel like analysing. I’m stuck in an airport after a very hard week and I’m tired, but I’ll go for the seven in one comment I wanted to write anyway.When I feel sad or angry (there goes the first one) because a potential client doesn’t buy, I think in how a good friend behaved when we were much younger. Before getting married and starting to manufacture kids, he used to be quite fun when going out at night. He was so horny (there goes lust) that he would try anything with any girl that passed in front of him. He was turned down most of the times, but he didn’t care as long as he had a yes most nights. He polished the approach and tried again. And he usually got at least one yes. He said that with women he had no pride (third!), he kept it all for guys. And he usually put us in fights because of this.Once, while completely drunk (does that count like gluttony?), he confessed that he went mad when someone that was not him was with a girl because he wanted all them for him (if that’s not greed…). We used to make fun of him and say that he was embarrasing, but deep inside we all felt some envy (one more to go!) because at the end of the night he was with a hot girl in the car and we were waiting for him eating a burger we didn’t even want (just in case vodka didn’t count towards gluttony) and complaining about being alone. What differenciated him from us was that he had no fear of rejection. We had, and we were too coward and lazy to work in overcoming it (and with sloth we finish!).BTW, I twistted the flow to get all seven, but this guy is real. And yes, he was good looking, but you can’t get all those girls just with a nice face. He now applies all that energy and focus to his job as a banker and he’s quite successful.

          1. Tereza

            Well done, Fernando!Your friend sounds like a real treasure.I wonder whose neighbor’s wife he’s coveting today…LOL

          2. Fernando Gutierrez

            In fact he is quite relaxed now. After a few years acting like a bonobo on viagra he calmed down a lot and focused on other things. I guess he had more than enough for a few lives!

  18. Jan Schultink

    Anger is a destructive negative energy. Don’t let it into your brain.

  19. Harry DeMott

    There is a great article in this months Vanity Fair (the one with Lindsay Lohan on the cover) in which Michael Lewis (author of any number of great books) goes to Greece looking for the source of the Greek financial crisis.He ends up at a monastery where he speaks with the Abbot.The abbot has a saying taped to the cabinet in his office which, translated, reads:The smart person accepts. The idiot insists.He then goes on to explain that those who are most successful roll with the punches – taking the answer no – turning it on its head and asking “Yes, I understand – and ……” where the idiot always responds “No, but……”Here’s another quote:“The idiot is bound by his pride,” he says. “It always has to be his way. This is also true of the person who is deceptive or doing things wrong: he always tries to justify himself. A person who is bright in regard to his spiritual life is humble. He accepts what others tell him—criticism, ideas—and he works with them.”Pretty good advice from the Abbot I would say – and apropos to eh conversation this morning.Go read the article – it is fantastic…

    1. fredwilson

      thanks for the link and sharing that advicelove the line about the idiot

    2. JLM

      I always look at money guys critiquing my deal in this way —“Where the hell could I get 10 guys from Harvard and Wharton and Stanford to take a look at my deal for FREE?”It is particularly gratifying if one of them has something nice to say about it.Even when I have my tin cup out and am begging for money, I never really let them know how hard I have worked on the pitch. I always say to them — “Hey, let me run something by you that I stumbled on.”When they don’t think they are being pitched, they let down their guard just a bit.They are brainstorming for YOU. Your own personal focus group.Once you have paid enough legal fees, you will appreciate FREE!

  20. awaldstein

    Never push ‘send’ when less than cooled down.I can’t think of any circumstance where putting something angry or contrite out in public is the right decision. What’s the quote?…”Forget the battle and win the war.”

    1. ErikSchwartz

      When I’m about to send a pissed off email I let an uninvolved party read a draft (usually my wife) and get her feedback and edits. Tone is very hard to get right in written form. It is really easy to come off as even more of a jerk then the person you’re dressing down.

      1. awaldstein

        So true. I have a trusted third party editor to watch my back on this as well.

      2. Tereza

        I try to keep writing to the relatively positive points and save the negative for a personal conversation.Sleeping on it helps too. With a fresh look you can strip out the emotion and stick to the facts.It always has to be about the facts.Save the emotional vent for your husband/wife/mother/best buddy.Get it out, and then get back to the facts.

        1. JLM

          Nothing ever looks or feels the same after a good night’s sleep and a breakfast taco. If you can fit in some BBQ and some Tex Mex — you are good to go on to the next lucky prospect.

      3. Donna Brewington White

        My husband is my best editor, too, and has saved me from sending some foolish emails. What’s good about using someone who knows me so well is that he can pick out the “truth” of what I’m saying from the “emotion” or how my own “issues” have entered in. Then, rather than throw the whole thing out, I can keep the “truth” part without the other junk.I so related to something Tereza once said: “We all have our little BS-y traits.” and I think being aware of this can save us from a lot of grief and regrets.Now I’m thinking I should probably let my husband edit my blog comments too. 😉

    2. Donna Brewington White

      I’ve learned that if I am feeling “compelled” to send a certain email, then I should definitely wait before hitting “send”.

      1. awaldstein

        This strategy has never proved itself wrong to me Donna.

  21. Kelley Boyd @msksboyd

    So many good comments here. As always.I find that if you have built a relationship you are better prepared to win (the work starts when the deal closes) and if you don’t win, it is likely because something has changed from the original buying (funding, selling, partnering) criteria. The first question every time you meet is to ask exactly that.As John states, it is important to find out why you got a no. If it is a valid no, you can move on with the relationship intact to come back again one day with a deal that fits. If you got jerked around, you now know better than to approach those folks again. Sometimes the faster I get to no, the happier I am. I can move on to a finding a yes.

    1. Tereza

      A fast No is a big blessing. We should say Thank You. Because then we are mutually not wasting time.The biggest time suck is the “Hmmm…maybe. Come again later when you meet milestone X”Hopefully they are being genuine. We probably have to be clever and dispassionate and decide if they’re considering us in any serious way, or are just collecting market intelligence.Remember — when each of walks in and pitches, we are sharing considerable market intelligence!

      1. JLM

        There are only two good answers in the money game — a fast NO or a fast YES.

        1. Tereza

          LOL, so true!So — you’re not a fan of “slow funding”, JLM?

  22. Tereza

    I wonder — just wonder — how many entrepreneurs’ No’s didn’t have to happen, because the meeting should never have happened.What I mean be that is — that a fit had a zero probably based on factors that could have been known in advance.I pose the question based on what I know in Sales.It’s proven that there is a clear correlation between success, and judicious pre-qualification. Only take high-probability meetings. Outside of those, conversations should be focused on talking around with people to ascertain Who is high probability, Who has the wallet, Who can say yes. (Many many people can say No. Very few have the license/wallet/cojones to say yes)When we focus your time on prospects who are Yeses to all the questions, then you can go deeper faster with the right people and not spin our wheels with the wrong ones. There are only so many hours in the day and we have so much else to do.And don’t a lot of VC analysts get measured on deal flow? So effectively, they’re incented to look at your deal even if they plan to say No? It’s total BS. And throws noisy bad mojo into your day. Who needs it?We have to take the power by owning our own sales funnel and being appropriately selective about who we’re talking to.Statistically, I have an almost zero chance of being funded. Yet, when I pull the covers back and look closely, many do not bring what I need to the table anyway. So what did I need a No for? Why do I need to bang my head on a wall wishing it were different? Keep looking, I say. If they’re interested, it’s their job to find me. They’re in the investment business.We have to keep our mojo up by taking calculated risk and eliminating unnecessary negative noise.

    1. Aviah Laor

      “calculated” is a bit stretched. Maybe insane? 🙂

      1. Tereza

        …or possibly “narcissistic”. LOL!

    2. JLM

      Targeting is everything but never be afraid to go outside the obvious. Give yourself a chance to get lucky!

  23. baba12

    Diplomacy is “when you tell a person to go to hell and they look forward to the visit”.Also suffering is arguing with your reality.With these two mantras in hand I find it is easy to accept rejection with a smile and not get angry, there are many number to diffuse the pent up anger, many mentioned here.

  24. Fernando Gutierrez

    The best way to realize that going mad doesn’t help is being on the other side. I was lucky enough to have that kind of experience early in my career and it has helped me a lot when given a no.When I was finishing my studies I was in a few selection processes with investment banks, although the only thing I knew about IB was they paid a lot of money. After several interviews in Madrid I did it to some final rounds. Two were in London the same weekend and it was impossible to do both. The guy in the bank I didn’t choose went mad. He yelled at me and told me that they were bigger and that the other bank was crap. I had some doubts before calling him, but they disappeared righ away. Although it looks like he was right about the other bank, it was Lehman Brothers…Whenever I’m pissed off about being rejected I think in that guy and try to cool off. It’s not possible always because some people are absolute jerks… but if you go crazy with one of those and try to take their lungs out of their chest you maybe doing them a favor, so in the end it’s not so bad.

  25. Aviah Laor

    Dear Founder!It’s not you – it’s us.Your vision is too grand – we feel we can’t pursue it.Your opportunity is too awesome – we feel we can’t meet the demands to fulfill it.We dare not to take away from you some of the most important startup experience – the victory over uncertainty, doubts crappy office (or bedroom) and cheap servers. Funding you now will eliminate all this. And you don’t want to deny our support from fellow startups, by taking this funding, wouldn’t you?So as we said – it’s not you, it’s us.Best and good luck,VC

    1. Antonio Tedesco

      You’re giving me the “It’s not you, it’s me routine?” I invented “It’s not you, it’s me.” Nobody tells me it’s them, not me. If it’s anybody, it’s me.Alright, George, it’s you.You’re damn right it’s me.

      1. Aviah Laor


      2. Tereza

        OR — alterntively — break up with them before they have a chance to break up with you.:-)

        1. Kelley Boyd @msksboyd

          Affectionately and alternatively known as the “take away close”. :>)))

          1. Tereza

            Advanced Closing Technique #2:”Would you mind just signing here that you’re not interested? I just need it for later in case your boss comes back requesting a meeting after we’ve finalized an exclusive deal with your competitor. I just need a paper trail. I’m sure you understand. Thanks!”

  26. JimHirshfield

    Success is defined by “no”. As others stated, you’ll hear “no” more often than “yes”. And you learn more when you hear “no”…as in a negotiation, if the other side says “yes”, then you just learned that you could have asked for more. A “no” helps define the other sides threshold, which we learn is sometimes infinity (IOW, NFW on the deal).Same for evaluations of your business plan. Every time someone says “no”, it helps to understand why and then learn, react, iterate, etc.Entrepreneurs also need to learn to say “no” to themselves. It’s easy to be hypnotized by your product just because it’s *your* product. Not good enough. You should reject your own ideas as much or more as you accept them. That’s one way good ideas evolve – get them out of your head where they can be evaluated and be prepared for them to change, which happens by virtue of saying “no”. (throwing a bone to steven b johnson here on the good ideas meme).

  27. MBA tutor

    Getting rejected is tough! Mostly because of the idea captured in the sentence by Fred “How can you not love my kids when I love them so much?” Rejection is tough weather it is personally, your idea, product, kids, etc. And it is one that we will all have to face. The key is to handle it well.Chris Dixon has a post on getting rejected personally…Senith

    1. Tereza

      This is where a dose motherhood comes in handy.Let’s say your kid’s teacher is not a good fit for your kid. You know your kid is special. And in fact, your #1 job on earth is to know your kid is special, and to give your kid unconditional love.Do you let the teacher play judge & jury on your kid? Make the kid feel crappy about him or herself and start hating school?No. You assess. Either the teacher has good reason — in which case you set pride aside and work with the teacher, and you work with your kid, to ameliorate the issue (behavior coaching, homework, etc.).OR, you realize, this is an unfixable, bad fit. The chemistry is not there, more interaction will hurt, not help. As quickly as you can so not too much damage is done, you get your butt out there and find a teacher who “gets” your kid.You do not have time to sulk about whether or not they like you or your kid. You’ve got to do what’s right for your kid. It’s the only thing that matters.

  28. Jim Larrison

    I agree 100%. But to take the other side, is there any value in highlighting things that might have happened during the discussions that could have turned the situation negative or ended up where people were not where they thought they were headed? I realize VC’s are under a ton of pressure, and I think that might lend itself to becoming out of touch with the emotional and personal side of the business.Would a professionally written letter to the VC firm thanking them for all their time, but highlighting the areas where there was frustration really cause long term problems and burn bridges? I know I am naive, but I would think a rational VC would appreciate feedback from the market on how things could have gone better during the process, so they can address these issues in the future.Just a thought. Maybe it is better to just leave it as is and focus on your own future and not try and highlight errors and mistakes of the past.

    1. Tereza

      I think feedback from customers is a more valuable use of time than feedback from VCs.In the early stage, if you’ve minded all your Ps and Qs, then at the end of the day, they said No because “They’re just not that into you.”Why beat ourselves up about that? NEXT!These people are investing in the toys that they want to play with. If they’re not into your toy, they won’t invest. Find someone who loves your toy.I think the first thing we do when someone says no is, look them squarely in the eye, smile, and say “Thank you!!”Boom. You’ve just re-set your personal energy field.You must be a heat-seeking missile for someone that loves your toy.

      1. ErikSchwartz

        The thing I have found useful about the misfit meetings is you can use them to rehearse. They open shows in New Haven before they go to Broadway (or they used to).

        1. Tereza

          That’s a great analogy, Erik.Let me expand and deepen it further. I know a bit about theater and film. Each is a “startup”. The method is time-tested. It’s not seen enough on this scene, though.The Preview period is a blackout period to work out kinks before getting in front of critics. It is inevitable there will be kinks. Probably major rewrites, recasting, etc.You perform in front of relatively friendly audiences, in smaller cities, who aren’t so important that their negative word-of-mouth buzz might kill you.BTW the critics may be in New Haven or in NYC — but they are still blacked out until you “premiere”. Critics agree not to show up during previews, as it it will (negatively) color their view of you. It’s difficult to “undo” a bad first impression.So — relating this to our world, I see the audience as your customers, and the critics are VCs.DO NOT get in front of VCs until you’ve talked to and practice-pitched your value prop, and demo’d some real-live customers. It will provide 100% improved refinement of your vision and crispen your pitch toward all parties. You will be considerably more confident and persuasive. Night and day.Last year I read a review of High School Musical 3. The critic said: “Writing a review of the High School Musical franchise is like going out into Hurricane Katrina with a $5 umbrella.”If the audience LOOOOOVES your show, who cares what the critics say?

        2. RC Williams

          “They open shows in New Haven before they go to Broadway (or they used to)” Speak on it Erik! Truth!!

      2. Satish Mummareddy

        I agree with the general premise of “They’re just not that into you.” And moving on, but sometimes you know someone is just right for you. And it will take a long long time to convince them of that.So you need to be judicious about how which NO you just shrug and move on and which NO you work on to convert to a YES.

        1. Tereza

          Dahling, as in dating, their “not being into you” but you “knowing they’re right for you” sets up a dynamic which could hurt you.Please review my old blog post about “The Rules”. need to get out of their face, lose 10 pounds, go buy a totally sexy outfit, increase your ‘date flow’ by dating lots of people, be radiant, happy and successful, and then be at a party where they notice you from across the room and they come to talk to you….and have to elbow through the crowd of people who are around you.The more you push, the less attractive you are.You must change the force-field.

          1. Satish Mummareddy

            I agree with most of what you said. I never said that you should keep pushing right then and there. And I also said “Work on getting to YES”, which includes some of what you said and a few other things.But here is my question, are you doing all those things to get the girl you want and will you wait for the girl you want or will you fall for the next girl that comes along who says yes?

          2. Tereza

            I think the path to happiness is to open yourself up to multiple paths to happiness.You need to know the specific criteria of what you want/need. You may THINK there is only one girl/guy/angel/VC who is right for you.But there is, in highest likelihood, another who is right for you too.Or two. Or five.

          3. Satish Mummareddy

            Agree that there is more than one right person for you or more than one path.But if you are shooting for the same quality of goals, the paths will be equally challenging. So my point is that you can’t keep trying alternate paths at the first sign of NO on one path. What you need to do is hack down obstacles in that path you are taking and see if you can keep hacking down all the obstacles to the finish line. If you believe in your path, you can get better tools, sharpen them and keep at it till you get to the finish line.If a VC doesnt want to invest in you because you are a 40 year old women then go find another VC but if they say your approach to the problem is difficult or you don’t have the right people on your team or you don’t have industry expertise/network so you need to find a partner who knows the industry better or if they say you can’t outsoure development, so you need to find a technical co-founder, you can’t just go to another VC who will ignore those issues and give you money.If you want THAT VC (say Fred Wilson) you go try to solve some of those issues and say fred I fixed some of those, but I can’t do the rest without some investment. I have shown that I can address the concerns you have, so if you believe in my vision, you now have proof that I can execute on the vision.If they don’t believe in the vision then you need to find someone else who believes in the vision. :)Goes back to my first point of understanding why they said NO. Can you fix the reasons why they said NO. If you can then you should try. If you can’t then go look for someone else.

          4. Tereza

            I do agree with you.All I’m really saying is, don’t think there’s only one investor on the entire planet for you. That does you more harm than good.There are things you can control, there are things you cannot. So I take it as a given in this discussion that the person pitching has done absolutely everything “correctly” for their business, and incorporated all feedback into their business that is possible.But the things you cannot change. For example — and this is purely hypothetical — a 30-year-old VC guy who is a bachelor does not have the life persective to viscerally understand the consumer problem I am trying to solve. It’s not his problem. He cannot get into it, emotionally. And I don’t blame him. It’s not his fault, nor his responsibility to! But why should he and I waste each other’s time? Once I have a hockey stick of traction, then he gets emotionally interested. Again, not his fault. It’s his job. On the other hand, an older VC who is married, has daughters, has paid more than his fair share of credit card bills for the women in his life — he understands the issue intimately, and may even feels blowback from the problem. And that is the type of person I need to find.All I’m saying is — there are other VCs, high-wealth individuals, strategics out there. There are ALWAYS other ways to skin the cat, to get what you need — if you really want it.

          5. Satish Mummareddy

            I guess we are filling in pieces that the other hasn’t said. 😛 But we are on the same page. :)BTW, I’m next to the Caltrain station in San Francisco. So if you have time to kill in between meeting or what ever on your trip, ping away. Great coffee shop around there- Philz.

          6. Tereza

            GROUP HUG!!!Satish I’d very much enjoy coffee. Thanks so much for offering.

  29. Mark

    Agreed. It is energy wasted. In fact, IMO rejection is always an opportunity for some objective self-reflection. Sometimes it is them, but sometimes it is you too.Probably a cornerstone of success is dealing with rejection (in all its ugly forms) in a healthy way.

  30. Florian Feder

    Same is true for VCs. If VCs ask for preferred shares, but we say no and offer convertible debt, then they should take it with class and bite the bullet, instead of wining about it on their blogs or in their meetings.

  31. SF

    This is why I like looking at my “draft” folder full of angry emails I never sent. Whenever I feel like writing another one, or have written one, I look there and realize I have never been upset about NOT sending those emails (even though people, like totally, deserved them, right? :)And so I add another one and look at it few months/years later and am glad that never went out.

    1. Tereza

      That’s a great tip! I will add it to my toolbox.Probably has you wincing, too…if not rolling on the floor laughing.Amazing how time puts something that seemed so humongous into the proper perspective.

    2. Satish Mummareddy

      Be careful not to hit send on one of those NOW by mistake when you sit and reread them. 😛 😛 😛

      1. SF

        Heh. As a rule I do not put addresses in until I am ready to send :)It is not without risk – but sometimes it is cathartic to write things out.

        1. Satish Mummareddy

          Agree. 🙂

  32. TideNGen

    LOL Great advice Fred and I am sure your friend will pick himself back up and be better forit. I had a VC today who had no clue about my product nor did he care which was fine I actually thought it was pretty funny a guy with a 500M cap and had no clue about the the difference between my tidal product and solar/wind. He says to me they are all the same LMAO!!

  33. Francis Hwang

    Ultimately it’s about this: The world is full of people who are inconsiderate and selfish and worse. They’re the rule, not the exception. Your job is not to try to fix every selfish person you ever meet. Your job is to spend as little time as possible on those selfish people, so you can move on and find more unselfish people, and then work with them as best as you can.

    1. kenberger

      I used to feel that it was indeed my job to fix them, and now realize that your method is much smarter. (PS: I hear Profitably is kickin’ butt)

  34. Chris Phenner

    It strikes me that you have to actually ‘hear no’ to be upset by getting a no.And I think it’s possible, with time and getting numbed by rejection, to not hear ‘no.’And it’s also possible to be obtuse and annoying, but I guess that’s where judgment fits.But I’ve found it simpler to ‘hear no no’s,’ and rather just to see ‘next time’ in those no’s.It’s like optimistic dyslexia for the soul.

  35. Alex Murphy

    Reality of life, more people will tell you No than Yes. Here are some examples: employers, recruits, girls (and boys), investors, buyers, and sellers. It takes many No’s to find the yes. This is the essence of “fail fast” so that you can understand what you are missing, move on, and improve for the next round. Hearing No and accepting it is the process of growing thicker skin.

  36. Guest

    Getting a no is 100x better than the usual VC response which is no response.

  37. Matt A. Myers

    Immediately reminded me of Chris Dixon’s last post entitled,”If you aren’t getting rejected on a daily basis, your goals aren’t ambitious enough”’ve been trying to get rejected daily since reading that – mostly by girls for now – but hopefully it’ll extend to VCs once I’m more ready. 😉

  38. TJ Nahigian

    Fred,Certainly can appreciate not liking a no, but I agree with you that it shouldn’t be taken very personally. For 1, every firm looks for something different, be it stage, management, market, differentiation, profitability, price etc. and it can be difficult to predict what any VC is looking for. A lot of what VC’s/ alternative investors go by is pattern recognition. Likely the firm you are pitching to has seen something similar in the past and decided to pass on it or invest in it. Learning as much about the investments they’ve seen or passed on in the past could prove to be helpful. I think the muscle memory that sticks with VC’s the longest are deals that went south fast, so learning about the duds are probably the most important.I also couldn’t agree more that the best possible revenge is having the investment go to the moon! It is certainly tough to see a company that you passed on doing very well and you can’t stop from kicking yourself.

  39. daryn

    My partner in a previous startup had a habit of sending these scathing emails after each negative response from an investor, criticizing them for their lack of vision, lack of professionalism, and their overall idiocy. He took everything as a personal attack, and It was a bad scene. I’d get a lot of backchannel responses asking me what was up, and it was hard to defend more than once, even if I agreed with him for the most part. There is really no need for it, I’d rather stay on good terms with folks and find a better way to channel my passion.

    1. Tereza

      That opens up an interesting discussion.Does his behaving like that provide blowback for you? (in the eyes of investors and others?)If I were an investor (and I am absolutely not, so this is pure supposition), I would wonder about his ability to create a happy, motivated team. I would presume that he manages by brute force and abuse, and that it’s not sustainable.I’m not sure…just wondering. Clearly you’ve parted ways for some reason and that may be one of them.

      1. daryn

        That’s a good question, Tereza.I have no doubt that it impacted the company’s reputation and abilityto raise money – though there were also plenty of other reasons thatdidn’t happen, but whether it impacted my own reputation, I don’tknow. We were co-founders, and so while he was the CEO and did most ofthe pitching, I also got to know most of the people we were pitchingand I hope I gained their respect on my own.I have actually known the guy for many years, and we’re still on goodterms. He’s a good guy, we just didn’t see eye-to-eye on a lot ofvision or approach, and ultimately that was why I left.

  40. Chris Waldron

    From an early age we here the word “No”. I remember in the 4th grade when I asked for a University of Michigan Starter jacket and my mother told me “No, we can’t afford it”. Instead of acting out I raked leaves and shoveled snow until I could afford that winter jacket (still remember it costing $110+ tax).Even though I didn’t understand what was happening at the time, I was learning to not let other people keep me from the things I wanted in life (material things, U of M education, love). I also learned not to focus on the rejection or take it personally.An important lesson I want to one day teach my children (and my team) is to respond to rejection with curiosity and perseverance. Curiosity helps me clarify my thoughts and better understand why it wasn’t right for the other person. Perseverance reminds me if I want something bad enough I have to be willing to write the check and pay for “it” in advance.

  41. Elie Seidman

    Startups are incredibly personal for their founders and employees. If they were not, they’d even that much more likely to fail. But no matter how much it hurts to have someone tell you your baby is ugly, there is no excuse for taking your frustration and anger out on someone else. I’ve learned the long and hard way to deal with rejection and lots of it. It’s not fun but it’s very much a cost of doing business. And if you succeed, the hard and emotionally gut wrenching times are something you look back on with fondness.From a practical perspective, the relationships you make along the way can really come back to help later. Bain looked at – and passed on – my previous business. I don’t think they came to regret passing on that business but they did like what we had done with it and the relationship we built was ultimately the foundation for Bain investing in Oyster several years later.

    1. JLM

      Never get mad at the money.

  42. MassMan

    Here’s what I’ve learned over the years pitching my various companies:• I’ve learned that you cannot make a VC love you. All you can do is stalk them and hope they panic and give in.• I’ve learned that it takes years to build up trust, and it only takes suspicion, not proof, to destroy it.• I’ve learned that you can get by on charm for about fifteen minutes. After that, you’d better have a damn good idea (or a big weenie or huge boobs).• I’ve learned that you shouldn’t compare yourself to others – they are more screwed up than you think.• I’ve learned that you can keep puking long after you think you’re finished.• I’ve learned that we are responsible for what we do, unless we are celebrities.• I’ve learned that regardless of how hot and steamy an investor relationship is at first, the passion fades, and there had better be a lot of success to take its place.• I’ve learned that the people you care most about in life are taken from you too soon and all the less important seem to linger like a bad fart.Happy Friday.MassMan

    1. Tereza

      MassMan, I don’t know who you are, but that is priceless. I hope you come back soon to share more wisdom.

      1. RichardF

        hey T, conspiracy theory for you, maybe it’s kid coming back under a new persona

        1. Tereza

          I LOVE conspiracy theories!!!

        2. Matt A. Myers

          Since when is Kid gone…

          1. RichardF

            he announced the retirement of Kid Mercury a few weeks back Matthew, I can’t remember the exact post

          2. Donna Brewington White

            The actual comment is in his Disqus profile… in the “Apocalypse and Bubbles” post……So this gives me hope — he’s only retiring the “Kid Mercury” persona but leaves the promise of returning under another guise…so I take back all the sentimental stuff I said…MassMan??? hmmm…

          3. Donna Brewington White

            Matthew — see my response to Richard if you want more info…

        3. Donna Brewington White

          That is so funny that it hurts.But what hurts more (not in a good way) is the idea of Kid being gone.Shoot. Can’t think of many people I love disagreeing with more!What a brilliant mind.

          1. RichardF

            I miss Kid, I hope he comes back soon, in whatever form he wants.

          2. Donna Brewington White

            In all fairness, I actually did agree with him a lot of the time too, and he continuously challenged my thinking. I like that.But mostly I just laughed.

          3. ShanaC

            Me too. He was a mensch guy.

          4. fredwilson

            i saw this in a gallery yesterday and thought of the Kid…i sent him an email with a link to it

          5. daryn

            Not to be totally déclassé, but first thing I saw looking at that piece is the first thing I always thought looking at Kid’s comments: “nut” job. 🙂

          6. fredwilson

            in a good waywe need “nut jobs”because every once in a while they are rightmy dad taught me that at a young age with the story of Galileo

          7. daryn

            “Here’s to the crazy ones…”

    2. Alex Murphy

      “• I’ve learned that you can keep puking long after you think you’re finished”Priceless.

    3. JLM

      You…………………………………………………………………………………………………..nailed it.Take the rest of the day off, be kind to someone cause you are getting lucky tonight, my friend.

    4. Fields Jackson

      Great comments – loved them all!!!

    5. William Mougayar

      I’ve re-read that list several times and so true. So who are you, MassMan?

  43. Jason M. Klug

    Absolutely agree with the value of taking a “no” with class.I’ve never sought funding, per se, but speaking as a small business owner who is constantly seeking out new projects, I can’t count the number of times I’ve been sought out by would-be clients who had turned me down months before. In those cases, it was always the way I handled the bad news which fostered their positive impression of me… so when the timing became right for them, I was at the top of their list.Even after a deal seems to have fallen apart, you’re really still in the middle of a *bigger-picture* sales cycle… act accordingly! (and that’s saying nothing of the value of *referrals* you might get after a failed sale…)

  44. Ben Saren

    Great advice Fred. I remember a few years ago when I was our raising money, and had been turned down a few times, a very well respected and successful Angel investor telling me, “Don’t give up. If you keep trying, it will happen.” It sounded like a load of crap at the time, but he was right. I think that’s true for anything – you keep trying, it’ll happen. Quitters never win, winners never quit.

  45. Vinay Pai

    I think this is great advice for life in general, even beyond VC deals. Former employers, other business or even personal contacts. Sending off an angry e-mail really is taking a short-term emotional payoff in exchange for longer term interests. It’s hard not to feel slighted when you’re rejected for a deal, or fired from a job and feel like you were treated unfairly.But it’s so much more valuable to leave it alone in the immediate aftermath, and retain a potentially valuable contact for the future. Never send an e-mail when you’re angry or upset or just after you’ve had a difficult conversation. I try to sleep on e-mails like that before sending them and have regretted it almost every time I violated that rule.In fact, when I’m composing an important e-mail, I usually put my own address in the to field as I’m composing it so I don’t accidentally send a draft I didn’t mean to send. Putting my own email address means that if forget to replace the recipient when I do finally decide to send it, I’ll be reminded of that fact when it shows back up in my own inbox 🙂

  46. Nate Westheimer

    This advice goes for more than just getting turned down for a deal. This is a life lesson.When I was in high school, I wasn’t the coolest kid and was the first Jew in a small rural school district. Let’s just say there were times when I felt kicked around. A few times I lashed back and I never felt proud of it. As soon as I realized my real revenge would be at our 10 year reunion, when I knew I’d be crushing it in life, I stopped lashing back and just walked away with a wry smile on my face.I’m a year away from that 10 year reunion, and while I’ve done well for myself — I think — enough time has past that I’ve let it go completely. I’m glad I let most everything go 9 years ago, and I’m glad to know I don’t need to shove my success in anyone’s face next year.When it comes to getting turned down for a deal (or a date, or the oppty to invest in something you like, or whatever else), I think this sort of thinking is best. The future will be the best revenge, and letting it go all together before you reach the future will be the best for all.

  47. sbmiller5

    Not to go all Ben Horowitz, but to quote Z-RO:”They say success is tha best revenge, that’s the reason i’m always on my grind…I’m leaving all you b*!ches behind…”just go kill it

  48. Farhan Lalji

    Every entrepreneur should spend some time as a telemarketer, or as a street charity fund raiser here in London. Hearing countless “no’s” but needing to move on quickly helps build resilience.

    1. Shefaly Yogendra

      Farhan,Yet we see no telemarketer or chugger ever become an entrepreneur. Why?

      1. Farhan Lalji

        I did telemarketing for a couple of days – don’t put it on my resume/cv or Linkedin profile, but it’s definitely helped me as I’ve tried to build, launch and sell these last couple of months.

  49. calitalieh

    This is a painful lesson to learn, especially when you are younger. My co-founder helps me with this. We have a rule that we do not react (email, phone, twitter, blog post, etc.) to any type of rejection (VC, job offer, customer) without following this process:1. write down what you want to say, as you are feeling it, with all the raw emotions2. sleep on it3. read it again, or in the event it didn’t warrant a written response, simply review the narrative with my partner4. destroy (very cathartic)5. replace with a “thank you” messageThe only thing I would slightly disagree with what Fred points out is that I am learning not to replace the original response with a “thank you” + “we are going to be huge…you missed out” inner monologue. The reason being is that, in my experience, it builds up lots of baggage along the way; the sort of baggage that becomes hard to get rid of as you grow older.If you are really going to thank someone, and focus on building a great company (with or without them), your intentions and actions should be guided by what you control, and help you move forward. In fact, rejections can be very helpful (not all, as some folks are just a complete waste of time) in that they give you (or at leas should give you) many things to think about. I view the aforementioned rejections as feedback, from people I want to hear/learn from (if I didn’t, then why was I there?).This is tough, and I am still learning. I still get angry, pissed, etc. But the process is helping us build a better mouse-trap, and keep our network alive and well.My 2 cents.

  50. RC Williams

    Dealing with “no” can be tough, but it’s much easier if it comes with some knowledge about how to get to “yes” or for ME to know when to say no. I hear it often enough (which is OK) and I learn something from it most of the time.

  51. Craig

    It’s no fun giving the No but I find it helps to:- do it as quickly as possible- give clear reasons why- own the decision – not hide behind “my partners didn’t like it”- and do it over the phone rather than email.For companies, please don’t treat a No as an objection to be handled. That’s where the sales analogy breaks down.

    1. JLM

      Haha, I love — “…and do it over the phone rather than email…” such a warm personal touch. So human and thoughtful.If a guy gets off his butt to pitch you a deal, stake him to a cup of coffee (hell, even a latte) and reason through your decision with him.Hell, he could turn out to be Thomas Edison — who reportedly whiffed on a few deals before he invented …. oh, what the Hell did old Tom invent?I just can’t remember but I think it was big? No?You have to love the soft touch of a caring VC, no?How about next time you tell a chap “no” — well deserved and sincere, mind you — you stake him to a cup of coffee and write HIM a nice hand written note.Who knows, he might just say something nice about you and the deal flow might pick up. But, hell, I damn sure could be wrong.

  52. Gregory Magarshak

    Very good point.From what I’ve heard though, VCs like to say “not now” rather than “no”, leaving you wondering just how much of a relationship they want to have.I say, the best way to get people to want to be with you is to make them feel good about partnering with you. So know what you have to offer, and keep refining it so that others know also. Meet people and know what they are looking for, and see if you can help them. It’s obvious in retrospect, but it’s better to have a good match than a bad one. A relationship where both sides want each other can blossom as they both put in the effort. Otherwise what’s the point? Walk away.

  53. CoreySch

    Another No means Another Yes is coming soon..

  54. Satish Mummareddy

    I feel that a person who says NO is extremely valuable. When someone says NO, the most important thing to do is make the other person comfortable enough to give you feedback, explain honestly the reasons why they said NO. If you can do that you will gain something even though you didn’t close this deal. It gives you a chance to turn into YES at a later time.

  55. Brennan Knotts

    The hardest rejection to accept is the rejection from something you didn’t really want in the first place. Those are the times you really feel like sending off a loaded email.This is yet another reason to set your goals high.

  56. goldwerger

    Agree wholeheartedly.Lots of factors out of one’s control when it comes to other people’s decisions or behavior – whether annoying, irrational, inexplicable, or even unethical.In business, the only practical course of action is consider the practical result of each possible reaction.And if there is none just keep it polite, since optionality is also a practical result.Also could be said for personal relationships (but unlike business, rational thinking rarely trumps emotions in that department…;)

    1. fredwilson

      optionality is a practical resultwell said Eyal

  57. PhilipSugar

    Stealing from Sandler Sales Training.You get to a yes by finding no’s.Same as Thomas Edison.Best advice you will ever, ever find.

  58. Danny Strelitz

    I always found Bob Dylan’s song “don’t think twice, its alright” to have the best description for this situation, and I found my self thinking of this song every time a process with investors have gone bad. The last two sentences in each verse:1. You’re the reason I’m trav’lin’ onBut don’t think twice, it’s all right2. We never did too much talkin’ anywayBut don’t think twice, it’s all right3. I give her my heart but she wanted my soulBut don’t think twice, it’s all right4. You just kinda wasted my precious timeBut don’t think twice, it’s all right

  59. Dave W Baldwin

    Great advice. Worked with a guy who produced television shows for Real Estate. He really tried to pull a fast one. Realized he was in big trouble and walked. Everyone asked why I didn’t sue. Can’t get blood out of a turnip.Doing the start up thing is like sales, when you hear ‘no’ it should be as you are in the act of knocking on the next door.

  60. Lindsay Lohan

    “I’ve learned that we are responsible for what we do, unless we are celebrities.”Hey, that’s not fair! I’m in jail for 4 weeks and all I did was get arrested for a DUI and cocaine possession, a 2nd DUI and driving on a suspended license, a 2nd cocaine possession charge, theft, violating probation, and failing a court ordered drug test.

    1. JLM

      Funny thing is that you, my dear, are in fact a talented actress. You need a better set of friends and you need an old fashioned spanking.

      1. Carl Rahn Griffith

        ‘Spanking’ – lol. You’re an honorary Brit, JLM! 😉

  61. Shefaly Yogendra

    Fred, this is no different from a situation where someone invites me in for advice, but when I write a detailed proposal that defines how their skin will have to be in the game to make it all successful, they say “no” to the project. This after all the “educating” that went into the proposalling! Sometimes that education is worth it. If the prospect does not have a level of understanding where he/she can appreciate my advice, it is more likely to be a fraught and possibly ultimately unsuccessful engagement.In my experience this attitude can apply to pretty much any situation where one party discusses a potential engagement with another party but the deal just doesn’t fly. One needs to move on and as they say in Sanskrit: “charaiveti, charaiveti” (keep walking, keep walking) long before Johnnie Walker said it.

  62. JLM

    “NO” is not the end of the conversation, it is the beginning!I have raised over $1B in my life and have only struck out on 3 deals. Deals that did not deserve or merit to be funded.Even though today I put some of my own money into a deal, I operate on the premise that if I cannot convince one other person on the planet to fund my idea, then the deal sucks and I suck for having proposed.It is like a “focus group” — a test recipe. I am USING the funders to evaluate my idea. I am not afraid to suck from time to time.I have been told “NO” in every language possible by every form of human classification and even, I think, by a couple of aliens.Entrepreneurs — you are not “asking” the VCs for money, you are testing your idea — is my idea good enough to get funded? You are engaging in intellectual espionage, you are reading their minds. They are walking your dog around the park for you. Use them for feedback like a Tijuana whore!No is start of any sales conversation — assume that the answer is ALWAYS no and then get to the objections. Don’t take “no” for an answer in any element of life until you feel a spray of holy water, hear folks crying and get a spade full of dirt thrown in your face.Until that happens, you are just identifying and overcoming objections — which DRUMROLL is what sales is really all about.Asky everyone you pitch your deal to to provide you with some feedback — don’t start w/ “why” they said “no”!Ask them for their feedback on the quality of your pitch (huge revelation, many deals fail because though you had an incredible ideam your pitch was well, “off pitch”), did they really undersand the deal, the most attractive elements of the deal and the least attractive elements of the deal.REVELATION: Sometimes you can get to YES by simply overcoming the specfic objections, the hurdles — or, even better, the VC did not understand what your were pitching.End every conversation by soliciting advice and then ensure you thank them profusely and get their contact information. Channel all that rage into being as nice as you possibly can.You will want that contact info because when you get to the Pay Window, you will want to ensure they get a copy of the tombstone.Don’t deny your natural emotions. Channel that rage into productivity, into “success” revenge. Hey, we all know you’re crazy, right? So use that craziness to fuel the fire.Keep making your pitch better and better.You are different. Embrace it. Mine it. Use it.The Pay Window does not care if you lashed out at someone and got your rocks off. Never, ever, ever burn a bridge.Pick fights, criticize and rag — VERBALLY. Praise, send money, trumpet success — IN WRITING.

    1. Matt A. Myers

      ‘It is like a “focus group” — a test recipe. I am USING the funders to evaluate my idea. I am not afraid to suck from time to time.’This is exactly how I’ve seen the idea of approaching anyone, even your friends – however they’re testing it on a different level, depending on their their expertise level or if they’re simply a consumer.Another post by you I want in a book… thank you.

    2. Matt A. Myers

      Anyone else want a “I Heart JLM” t-shirt? I know a good local screen printer here, I’d be willing to put the time into designing it and getting it out to people.Maybe they should be packaged with JLM’s future book…

      1. JLM

        I think we need a Pay Window tee shirt. I will get my illustrator on it.What………you don’t have your own illustrator? LOL

        1. Matt A. Myers

          I do fine on my own. “I Heart JLM” isn’t too complicated. 🙂

        2. RichardF

          …..I WANT A PAY WINDOW T-SHIRT!!

          1. ShanaC

            Maybe I should design one. I’m not totally in love with some of the descriptions here- need to think

  63. Donna Brewington White

    Sometimes a “no” can be freeing — both to the person giving it and the person receiving it. It rarely feels that way in the moment.I wonder which takes the most maturity — giving a “no” with grace or receiving a “no” with dignity.

  64. David Fishman

    No is just one step closer to yes!

  65. Thomas Browne

    Let’s face it, VCs of the current vintage are for the most part wanabee entrepreneur losers. Few have managed companies, met a payroll or could get a gentleman’s C in a science or math class.VCs also have no class so don’t lose any sleep. Most of the time they have no clue what you are talking about and only invest when a deal is a flavor of the month. Let’s get rid of the founder and put it in some lapdog hack – great stratgey. Just look at their returns, LPs know these people have no clue. Throwing darts at walls.I was tunred down by 109 VC firms in my first venture and after 12 years of struggle I am wealthy by any standard. I do get a laugh when I run into these d-bags on a panel or at a bar.Slap them around by succeeding. Most VCs can’t raise funds anymore because they don’t know what they are doing. Just go out raise money and build the business.

  66. Volnado

    Sounds like alot of modern relationship breakup stories… should I send the o so important text or email that says how I really feel … or save it as a draft…Or the whole Angel Gate thing in San Fran… the power of one email or post to define your feelings on the situation (Trademark Mike “The Situation” Sorrentino 2010) on your terms. Should Ron Conway or Dave McLure have sent those out? Or Kanye with twitter. Was he drunk when he sent those? Am I?My first serious girlfriend in college wronged me like this guy felt the VC did and I wrote an email that ultimately made it impossible for any contact much less the needed closure or possible reconciliation at some point in the future. We talk now and I realized that if just that email would have been erased from history we could have talked back then in school not 5 years later.My solution to the specific problem you state with VC-Startup communication is to go old school. You might not send that nasty email if it were like Shakespeare days. Hamlet put alot of thought into his letters to Ophelia… alot more than I did writing that email. I wish I would have had to write out that email with a feather and inkwell and get a courier to deliver it to her. My love for her then is of the same stuff that Romeo’s was for Juliet… Scrolls are just so much classier than emails though and I wish I rolled like that in my letters with lovers. Imagine if your friend had a feather and an ink well and a papyrus scroll that bore his literal seal of approval in wax when he went to send it. That type of correspondances was guaranteed to require a good amount of time and effort and that is why people held onto their letters and scrolls as priceless parts of their lives.So a company that makes the solution to this VC – Fundee communication problem help change the world. A large number of VC’s (Led by Fred) move their official correspondance like introductions, invitations to talk more, deals, and final decisions with potential fundees to some new brand of environmentally friendly recycled papyrus-like scrolls. Changes the world because it generates revenue for a non-profit literacy program (in my city New Orleans perhaps?) or a Tree planting project or something else great and needed. If you want to start a conversation or end a conversation as vital to each others business as fundraising and investing you need to do it with this one method of communication… email is on auto-respond for unsolicited mail and after the scroll is accepted you can get you emails through… but decisions etc come via scrolls. The Scrolls cost $5/10/20 or whatever for 1-pagers or lager ones for requests for business plans. You also buy an official company seal and wax for $50/100. Can sell inkwells or you can even go really old school and pay a scribe. Could be a green courier service attached to it as well or just use fedex tubes. Price at whatever huge markup and create jobs for the people who run the paper recycling plant and shipping center and calligraphers and couriers. VC’s can buy the paper in bulk or get it as part of the terms for their micro-investment in the company. Got more ideas on the biz operations but not important now. The economics is that this price to send official correspondance will filter out alot of the bullshit VC’s get like rejection response emails and shabby business intros. Fred you can help determine the size of the impact. How many emails do you get for funding per year? How many do you engage with? How many correspondances are average with each of these engagements? Figure out a number for the impact of the price and do the math and multiply by the entire VC industry worldwide and thats it.When a VC sends you an official no and when you VC’s get a nasty scroll sent to you or a shite business plan… both parties can walk away saying the world got a little bit better because of that since the world changing program was funded with that scroll and seal. And when you get the good letters on both sides… you have a priceless scroll that you can frame. Here is my official YES to this entrepreneur who really did it and made it happen. Or even frame your official NO’s to give you more motivation.If someone out there in land wants to help on this… that would be cool of you. Send an e-scroll to [email protected]

  67. Carl Rahn Griffith

    Discretion is the better part of valour.Sometimes 😉

    1. Peter Beddows

      More like “always”

  68. Eric

    I would be happy for a straight “no”.After many discussions with VCs in the past 6 months I either get jerked around towards no end, or get a wishy washy answer to come back later when we are further along.They do not tell you that they are not funding your stage, that they are not funding new projects, etc.Mostly it seems they hold meetings to show activity in their weekly report.Give me a straight answer any day.

  69. Keenan

    Welcome to the world of sales.My blog’s tag line is “At the end of the day, everything is sales” This is the truest statement in the world.Getting your future spouse to go on that first date, and then to say yes at the alter, is sales.Getting VC to invest or getting that college to accept you are both sales. If someone can say no and you need them to say yes, welcome to sales.Learning to be OK with no is a huge asset. I’ve been selling in life and at work for years, and I’m still learning to accept it.Fred you’re right, it never feels good, taking the high road and moving on is the only noble way to handle it.

  70. matt roberts

    Nothing is wrong with getting a no…. I prefer it. Its the endless maybe…. and then a Yes only when they know theres other term sheets being looked over.

  71. InTheBox

    Yep, much better to kiss up here. if your friend wants to really make an impression his email should volunteer how much better his company is going to be as a result of the brief, but extremely valuable exposure to Mr. VC’s keen and unique time he calls, the vc will pick up the line. guaranteed.

  72. Craig Plunkett

    When it comes to business, as a hockey player and fan, “Its always the playoffs” Hard not to retaliate, but essential not to. The ref ( somebody you may want/need something from in the future ) never sees the initial infraction, only the retaliation. It’s always filed away for the future.

  73. Si Chen

    Try not think of the VC as “better than” or “above” and you will not be so upset any more.

  74. Maxrevz

    Dealing with VC’s is not like making a sale. What salesmen would take “no” for an answer after researching their target?VCs/Angels(investors) typically do not offer objections for a salesmen to overcome during the approach stages. Aside from a review of their portfolio companies a salesmen has zero visibility into investor interests. This makes improving a pitch difficult. Investors are not upfront regarding the stages they actually invest in. Their definition of “early stage” is a moving target. Unlike, making the sale investors signal to each other and compete in ways that companies do not. The last thing an entrepreneur should ask for is a referral from one early stage investor to another if they approached the first investor in earnest. This is the kiss of death. It can create negative buzz among investors.Investors typically pass based on gut feelings rather than fundamentals relating to your opportunity. Dealing with them is nothing like making a sale, at least not in the conventional sense.I applaud Fred Wilson for all of his efforts to help entrepreneurs understand the complex world that successful “investors” live in. However, on the subject of taking a “no” for an answer and walking away I disagree. Respectfully pressing an investor for constructive feedback helps the entrepreneur, and ultimately the investors over time. Note the word “respectfully.” If handled properly pressing an investor for constructive feedback can help foster a relationship. It shows that you are serious about your business. I walk away from investor’s that say “no” and when pressed provide zero feedback.

  75. Maxrevz

    Spot on JLM. This is excellent advice thank you!

  76. Fernando Gutierrez

    There goes a link to Guy Kawasaky’s “The Top Ten Lies of Venture Capitalists” about VC language:

  77. Tereza

    I agree about the passivity of the Nos. It takes cojones for them to give you a real No. So if they do, thank ’em squarely, and do it graciously. They *might* remember it later.If you do something rash in response, they’ll *definitely* remember it later!!They know we’re the ones with real guts bc we’re putting our livelihoods behind our mission, knocking on doors, creating opportunities…and taking fire every single day.Any investor who doesn’t know that deep inside them is not in it for the long haul, and will not stand behind you when the chips are down. That type is more into what the other VCs think.Too much playing “judge and jury” and not enough “hey — here are some things to consider, to get your dream to work” — that is a signal to look for.

  78. Dale Allyn

    But then, of course, one should then read “The Top Ten Lies of Entrepreneurs” as well – just to keep it fair. ;-)…

  79. Vinay Pai

    I agree with everything in the article except where he says “there’s no upside to communicating a negative decision”. I actually think a firm “no, because X” might actually leave the door open more than just being strung along.If you’re strung along you have no idea what’s going in their head, what they don’t like, or anything. If they say “No, we aren’t interested right now because X”, you know that it might be okay to send them a quick follow up if X ever does change in the future.Plus, if you have a good attitude about it, it might turn out that they’re right about X, and it helps your business out and you get something valuable out of the time invested pursuing a contact.

  80. Fernando Gutierrez

    Fair enough!

  81. Tereza

    Awesome! There are a few I wasn’t using yet! 😉

  82. Alex Murphy

    So the funny part there is there are only 9 lies for the VC crowd, and 11 written for the Entrepreneur side. Considering Guy is / has been a VC / investor, I would consider that pretty fair and balanced. 🙂

  83. Aviah Laor

    But we can always buy a brand new Moleskine notebook.On the cover, with big clear letters, we write: “THE PAY WINDOW”On the first page, as a daily reminder, we quote “There is a door just on the other side. Made of a flat finished but warmly polished mahogany upon which simple gold leaf letters simply say — PAY WINDOW… The pay window opens without warning, like the Bermuda Triangle, and it conveys great abundance upon those who have paid their dues”.And everything is going to be fine.Actually I’m going to get myself one.

  84. Tereza

    It’s all about The Pay Window, baby.And getting there by doing the right thing along the way to the people you encounter, and delight lots of paying customers along the way.Beyond that, it does not matter how you get there.

  85. JLM

    Ahhh, another devotee of the Pay Window. The first requirement to get to the Pay Window is to believe — to believe it lives and exists and is waiting for YOU!Because it is. I promise you.You have learned well, my friend, and the force is strong with you. You have no appreciation — yet — of the force within you.Stay hungry and stay sharp and look for the Pay Window because it is looking for you!And, shhh, don’t tell anyone else that you are now part of the Brotherhood of the Pay Window because it is ………………. secret.

  86. Aviah Laor

    agreed. wholeheartedly.

  87. panterosa,

    Your lovely description of the pay window is missing one thing. Casting! Shouldn’t it be Mme Deneuve pushing the bills under the glass?That inspires belief no?

  88. ShanaC

    You promise?

  89. joeagliozzo

    Yes – must get t-shirt – BOPW – Brotherhood of the Pay Window.BOPWIt lives.It exists.It’s waiting for me.Stay hungryStay sharp.Can I fit all that on a t-shirt?I love it.PS – sorry JLM, but my UCLA Bruins had their day in the sun today v Texas – I was at “rout 66” in 1997, but had to enjoy from afar this year – would’ve paid anything to be at Shultz’s tonight!

  90. karen_e