146. Two More Investor Trick Questions feat. Abby Mercado @ Rescripted
Where are you in the process? What's your valuation expectation? Abby provides guidance on answering both of these trick questions.
About Rescripted
Reaching 9M people monthly, Rescripted is the #1 global media platform for women's health and fertility, providing content, tools, and resources for wherever you are in your reproductive lifecycle. Learn more at rescripted.com, and follow along at @hellorescripted on Instagram and TikTok.
About SpringTime Ventures
SpringTime Ventures seeds high-growth startups in healthcare, fintech, logistics, and marketplace businesses. We look for founders with domain expertise, forging a path with a truly transformative technology. We only invest in software-based businesses in the USA. We bring a people-focused approach, work quickly, and reach conviction independently. Our initial check size is $600k. You can learn more about us and our approach.
About Rich Maloy
Rich’s mission is to rebuild the American dream through entrepreneurship. He believes technology gives all people the opportunity to grow, learn and earn. He is a Managing Partner at SpringTime Ventures and the host of the VC Minute podcast. With prior careers in finance and sales, he's been focused on the startup ecosystem for over a dozen years. He's a father of two young children and loves sci-fi, skiing, and video games.
The second question that can be pretty tricky is where are you in the process? Basically, are you popular? Do investors love this deal? Is this going to be oversubscribed? Is it a popular deal? Should I get in? They don't wanna miss out. There's that element of FOMO there. This question, you really want to somehow convey momentum. It's important to tell the truth. It's important to not overplay your hand. You're gonna look like an asshole if you say that you have a term sheet when you don't. The investor world is a small world, people talk. You can talk about eminent term sheets, but don't do that unless you're 90% sure that you have one in hand. The right answer is something like, you're getting great feedback and you would really like to have some sort of indication of interest in the next few weeks. And then you are interested in choosing the right partner after that. Emphasis on the right partner. VCs love that. The third sneaky question is, what are your valuation expectations? And during my process to raise our seed funding at Rescripted I got all three of these questions by pretty much every single vc. In this question, don't share numbers. You wanna say that you wanna make sure that the valuation that your company gets is fair and is consistent with the market. You also wanna show them that, you've done your research. You know in a seed round that VCs have certain ownership thresholds. But, you also wanna make sure everybody is appropriately incentivized. I would say that personally, everything that I have done has been, it's all about my team. My team is everything to me. VCs love to see that you're taking care of your team, your co-founders, your early employees, et cetera. That's really important. You also wanna emphasize that you're looking for the right partner versus the highest valuation. And also note that you wanna be solutions oriented when it comes to valuation expectations. So, you can be flexible, but just really looking for the right partner. Those are the three sneaky questions that can really make or break you when it comes to raising your seed round.
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