VC Customer Serivce
Jeff Bussgang had a good post today about the tension between VCs and entrepreneurs which sometimes lead to VCs being branded as arrogant. There is no question that many VCs treat entrepreneurs poorly, which is why things like this really resonate. And, if web sites like thefunded.com help increase transparancy in the VC-entrepreneur interaction, then I am all for it. Unfortunately, sites like this tend to capture much more of the negative feedback than the positive.
However, I don't agree with Jeff that brusque interactions are important for VCs so that they don't waste time that can be spent on more productive projects. I see no reason why you can't treat entrepreneurs with great 'customer service.' At Venrock, we actively discussed customer service and how we treated entrepreneurs when they came in to pitch us. I thought that this was very healthy. Part of good VC customer service is not wasting the entrepreneurs' time, in addition to not wasting our own.
But, every interaction with an entrepreneur can be a value-added one. You can always give feedback, make an introduction, and offer advice. You don't have to extend the meeting to do this, and you should always be direct about your reasons for saying No. Saying No should be done live (in person or over the phone), but a direct email or voice mail is still far preferable than radio silence. And, you can cut short debates about whether your feedback is right before they get out of hand. I usually did this by starting with "I never change my mind about these decisions once made."
I always got feedback from entrepreneurs about the direct communications I had with them. Giving them a clear No and some good feedback can help the entrepreneur. I found that many times these entrepreneurs came back to me with updated plans or with their next plan. And, they referred other entrepreneurs to me, too.
In poking around thefunded.com, I was happy to see that entrepreneurs took the time to post positive comments on some VC interactions. I hope that these positive comments become a nice benchmark for other VCs to aim for.