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How to make a deal with a VC at a tech conference

If you’ve done your homework, it’s easier to get past the firewall

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Mahendra Ramsinghani

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Mahendra Ramsinghani is the founder of Secure Octane Investments, investing in cloud infrastructure and security startups. When he is not investing, he is busy writing blogs and books. His third book “The Resilient Founder” will be released in 2022.

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Are the schmooze sessions, after-parties and secret dinners with investors that take place during tech conferences mere distractions, or are these events an opportunity for founders to close a deal?

Which parties should you attend? How do you get in? And above all, what outcome are you working toward?

Some events are small, while others are shows of pomp, power and pizzazz.For me, this is a time to bring value to my portfolio,” says Sid Trivedi, partner at Foundation Capital. Foundation’s RSA 2020 event is a small gathering of 50 people who fall into one of three categories: buyers from Global 2000 companies, channel partners or portfolio CEOs.

“In particular, I am focused on helping seed-stage companies because they rarely get access to such a buyer universe,” Trivedi says. At the other end of the spectrum, some events will have several hundred attendees, which raises the odds of getting lost in a crowd.

“If the event has a well-curated attendee list, it makes it worthwhile for both sides. Often, I can scan the room in 15 minutes and know if I want to stay here,” said Ariel Tseitlin, a partner at Scale Venture Partners. Some conference events are hosted by top-tier investors and partnership-heavy corporate VCs, while others are driven by consulting groups that share market trends and research content. As one founder bemoaned, “why can’t we just have a Tinder for VC-CEO match-making?”

Bypassing the firewall

If you don’t have an invitation, I don’t advise just showing up at the door; these are well-guarded events. Gate-crashing is a good strategy for a 19-year-old (who has the maturity of a 12-year-old), but not for the rest of us. Some founders use a simple tactic: get an existing portfolio CEO to take you in as their guest. Most VCs love it when they get such an introduction; it’s a great start and much better than sending a cold email or a LinkedIn to the lead partner.

But a well-constructed cold email can also open doors:

“I see you’ve invested in Company X and Company Y — we’re building next-gen products to tackle gross inefficiencies in this market. Since our GA/launch a year ago, we’ve snagged 15 enterprise customers and will cross seven figures in ARR. Can we speak briefly at RSA2020 about our upcoming Series A round?”

If you’ve done your homework, it’s easier to get past the firewall.

The secret handshake

Jake Flomenberg, a partner at Wing Venture Capital, once had 20 minutes to kill at a conference and strolled into an “Israel Chamber of Commerce” networking event. “As soon as I walk in, I meet this unassuming, soft-spoken guy, Slavik Markovich, who was CEO and co-founder of Demisto. It was one of those chance meetings. We met for three minutes at the event and signed a term sheet in two weeks,” says Flomenberg, who was with Accel Partners at the time.

Flomenberg led the Series A round of $6 million. Last year, Demisto was acquired by Palo Alto Networks for more than $500 million. (I too was a small investor in this round, so I count my blessings much more than my money.) “For me, Slavik demonstrated instant credibility,” Flomeberg says. “He had been in the industry for over a decade and was solving an incredibly painful problem.”

Kate Brodock, founding partner of women-focused W Fund, is in deep diligence with a startup she recently met at an event. “I met this founder who was authentic, smart and knew her business well. It was a great first meeting where we talked shop briefly. But we also talked about a wide range of other topics.” The key here is to not oversell, and engage as a human being. Most founders get into aggressive selling mode, or worse, treat VCs like celebrities and fawn all over them. Investors will never see that as a healthy sign. Be a human.

Jordan Husney, CEO and founder of Parabol, shared an interesting divide-and-conquer tactic. “My co-founder was great at working the room. We devised a plan where she’d strike up a conversation. But whenever the VC asked more about the company, she’d say, ‘you know, you should ask my co-founder, Jordan.’ And soon, I had a line of investors waiting to ask me questions. My attention was fought for.” Jordan successfully inverted the pyramid and created a pull versus a push; Parabol ended up raising its $4 million seed round from CRV, Haystack and Slack Fund.

Simple rules for effective networking

“If you had three simple rules of effective networking, I’d boil them down to differentiation, qualification and protocol,” says Jacques Benkoski, partner at US Venture Partners. “I’m looking forward to meeting founders who can give me a one-line pitch that differentiates them from the crowded cyber marketplace. I then want to know what qualifies this team — how has their experience and background help[ed] them to work their magic in building a valuable company? And finally, event protocol demands that you don’t interrupt, or overstay your welcome.”

When it comes to meet-and-greets, Jacques offered a simple guideline. “You have three minutes with me — what are the three adjectives you want me to remember you by? Aggressive? Smart? Thoughtful?”

“The investor is investing in you,” says Fred Kneip, CEO of CyberGRX, which recently closed a $40 million Series D round. “How do you come across — your style, intelligence, energy and EQ? Authentic? Can you inspire confidence? Why do you want this particular VC to join your cap table?”

One basic piece of advice: Don’t get drunk.

“You’d be surprised to see how many smart people are unable to monitor their alcohol consumption at such events,” says Tseitlin. “Slurring your pitch is not a great start.” One VC I spoke to arranged a breakfast meeting with a CEO who showed up 25 minutes late and completely hungover. Not a good start.

Some entrepreneurs may try crazy or cute tactics. At one event, a founder offered a VC what appeared to be a hundred dollar bill. Holding it between his index finger and middle finger, he attempted to thrust it into their hands with a coy smile: “Instant returns for your time today?”

The VC recoiled instantly and asked, “What are you doing?” Instead of offering a crisp new Franklin, the founder was holding a business card that was printed to look like one.

“It’s great if you wear your company T-Shirt at the event. That’s a good start,” said Flomenberg. “But don’t send me those T-Shirts and tchotchke[s] every week to follow-up.” At one event, a founder posted his one-page pitch over the urinal in the men’s bathroom. Stalking a VC into a restroom or to their parked car is not a good idea, either — respect their privacy.

What about second shots? Should you approach a VC at an event who’s already said “no?” Zach Aarons of Metaprop VC would say so; a founding team he had originally passed on bumped into him four months later at an event.

“They kept it friendly and high-level; they showed me that they were human beings, not just entrepreneurs,” he says. “At the end of our conversation, they dropped the soft sell, saying something like, ‘We have made a lot of strides with our product and new CTO. We would love the opportunity to catch up. We would appreciate another shot.’ ”

That conversation led to Metaprop’s investment in Bowery Valuation. A respectful approach combined with meaningful progress paid off for the founders. For those who can get their ego wrapped around an emotional axle, know that we are all playing the long game. We are trying to build trust in each other. Showing progress at each step matters.

Following up after the event

Should you text them the same night? Send a LinkedIn request the next morning? The next week?

There is no good answer, but you have to keep working on it. Surprisingly, the most un-leveraged part of events is the breakfast meeting. Try to get a meeting at 8:30 a.m. if you can. Eric Liaw, general partner at Institutional Venture Partners (IVP), reminds us to manage our expectations. “Like everything else in life, some conversations will progress well, and some won’t. It’s in the founder’s best interest to cast a wide net and be realistic.”

Know that at every such event, VCs are likely to meet a few hundred founders. Being persistent and professional pays off, but being pushy can cost you your job.

As one VC recalled, “I met this extremely pushy and aggressive founder. He literally stormed to the front of the line, cut into a conversation and almost yelled into my ear. His idea was brilliant and we eventually invested in the company, but in less than a year, we had to replace him. His style was symptomatic of a brazen bull in a china shop — the first meeting told me a lot about him.” The company was acquired for $400 million and was a great outcome for the investors. But the screamer of a CEO was relegated to the background. You can win the term sheet but lose the company.

Most attendees who come to such parties leave too much to chance. If all you want is just a hangover, that is easy. For the rest, go ahead, research your events, build your target list and after-party KPIs. Aim to get at least five solid leads for follow-up meetings.

But don’t overthink or get too caught up, and leave some room for serendipity.

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