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August 07, 2011

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Comments

daniel aaron bernal

Good article, good points.

Alex

Awesome. Subscribed.

Kenneth Seville

Mark Suster says that he invests in lines not dots, and therefore entrepreneurs should get in touch earlier rather than later: http://www.bothsidesofthetable.com/2010/11/15/invest-in-lines-not-dots/


It seems like the two of you are saying opposite things, am I understanding correctly?

Allen Morgan

Thanks for the comment. Mark Suster (who is a friend), is one smart dude, and the question under discussion in my post is certainly one on which reasonable minds can differ.

Most of Mark's very good post is written from his POV as a VC -- and the process he outlines serves his interests, as a VC, very well. VC's (me included) will always want to have the chance to look at a deal over a long period of time, seeing how it develops, etc. See my post on this topic at: http://allensblog.typepad.com/allensblog/2011/06/walk-the-walk-not-talk-the-talk.html.

That's all in the VC's favor, so no surprise. My post, however, was specifically written from the POV of advising entrepreneurs and their startups. If you're pitching Mark, who is a great investor/mentor, then you may have to spend a lot of time with him (silver lining: he's fun to spend time with!). But, there are costs associated with that and it's those costs on which I focused in the post. For a great VC like Mark, the costs may (just may) outweigh the benefits. If you have a hot deal, however, Mark will behave like any other smart, rational investor and react only to competitive pressures.

Mukund Mohan

This is fairly incorrect. People invest in people, not ideas alone. All things equal you'd rather invest in someone who you have some relationship with than not. So, while it may be better to not talk about your company, at the first meeting, its always better to build a relationship with investors WAY ahead of your need to raise money.

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