Reading VC Interest

If VCs don’t offer feedback you can try to assess their interest by reading other signals.

VCs’ interest in your company is usually easy to read. Their tone is the best subjective indication of interest and their frequency of communication with you is the best objective indication.

With regard to tone, some VCs show emotion more than others. VCs that show their emotions will usually demonstrate excitement or a lack of interest in their conversations and correspondences with you. With VCs that are less emotive, you will have to look for more subtle indications such as an appearance of satisfaction with your answers to questions.

With regard to frequency of communication, at a high level, more is better. If you receive one email or phone call from them per week they are likely to be more interested than if you are not contacted at all. However, there are some exceptions to this rule of thumb. For example, if you have just presented to a VC, he may be interested in your company but contact you immediately, as most firms have an internal process to undergo. On the other hand, a VC may contact you frequently to understand one part of your business that they are uncomfortable with. For example, if your addressable market estimate seems too high to the VC they may have several conversations with you in a one week period to better understand this issue, because it is preventing them from getting excited about your company.

In the end, you will have to draw some conclusions based upon the signs you see both in a VC’s tone and frequency of communication (in the context of their process).

This column was provided by Mark Davis. Mark is the author of Get Venture, a column designed to help entrepreneurs raise venture capital.  In addition to his column, Mark is active in the venture community as an entrepreneur, advisor and venture capitalist.  He currently works at DFJ Gotham Ventures, a leading early-stage IT venture capital fund based in NYC.  Mark earned his B.A. in Economics with a minor in History at Duke University and is pursuing his MBA at Columbia Business School, where he is the Early Stage President of the Private Equity and Venture Capital Club and the Founder of the Columbia Venture Community .