Let Your Nay be Nay.
by Vijay Anand
I am actually quite surprised by the reaction to the post that I made on Startups, Funding and the Dating game. Seems like most folks enjoyed it and I even got a few personal mails on the same. Heh, reality is one to laugh about, isnt it?
I also got quite a few notes from folks, especially since as of late it has become a topic of use for getting acquainted and breaking the ice, one feedback that keeps coming from the side of the startups is that “We are more often the victim here, than the Investors”. I am not too surprised, but given that the investors are made the bad guys more often than not, It was time to go after the conspiring startups.
But on a serious note though, I am hearing from an alarming number of people how people (especially the founders or the investors) don’t get back with a Yes or No soon enough. I always used to say that “maybe” and “If” were two of the most complicated and conditional terms in the english language. Partly because outcomes can rarely be predicted as to whatever follows those words. And Maybe is the worst. It is neither here, not there, nor anywhere, but its there. You don’t know whether you want to put that as a prospect or get it off the list and move on with life.
The best qualities that I have heard from VC firms are those that had two qualities. One, their Yes or No came quite fast. If it was a No, it came out really fast so that the founders could move on. And the second was one where a VC firm was courteous during the “due diligence” process while questioning the founders and team about their strategy – afterall its their company.
The onus is definitely on both sides. I have equally heard of startups that talk to an investor and get a term sheet and then go around shopping trying to get a better deal from other investors. We still haven’t heard of too many VCs using the No-shop clause here in India, but I hope we wont get to that where legal battles rage and knowing our legal system, it is better to stay out of it.
I can’t advise the Investor community of anything, but the startup community could surely use this advice. Straight out of the book, keep your Yea as Yea and Nay and Nay, whether it comes to a deal, or even that recruitment drive you did and are sitting on those ten resumes. Get back to them at the earliest with an answer, even if its a no. They’ll appreciate it a lot, and a startup could use all the good will that is out there – plus, what goes around does come around.
Recommended Reading: Getting to Yes, by Roger Fisher
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Pinpoint accurate topic , I say , the same should be with the banks too…Yes or No…Don’t waste an entrepreneurs’ time , it is the most valuable asset he has….
Nice Job
Tomas
At times, especially when you have few choices, creepy `Yes’ is far better than swift `No’.
It depends on who is vacillating. If it’s the seeker (say, startup looking for funds) that is dithering, it means (s)he is got choices. But don’t juggle too many because you could end up dropping all balls.
If it’s the service provider (Angels, VC, Banks), then (s)he is probably looking for better terms. That means room for negotiation. Pick up the slack and ask them “what more do you think we should be doing?” Revisit the deal, give it a makeover and call on them again. You could be in for pleasant surprise…
Bitching people’s ways don’t get us anywhere. We’re not here to change them. We’re here to use them, exploit them to our advantage. So just go find the best way to do just that. Some are grumpy and procrastinating by nature. Accept it. They defer almost anything. Recognize that it is the format of their decision process. Yes, No, May be are different steps that eventually would lead them to finally say yes or no. Be in touch with them and on top of their mind, but never interrupt their process. That way you betray desperation and give them ideas. Sometimes it might rattle them and they will down the shutters in a huff. You want neither. You want a Yes, don’t you…? So focus on that, just that and not why some people are assholes.
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