We like to think of the venture capitalist as the most important customer of a startup, certainly in your startup’s early phase. And just like any other customer, you should provide your VC with excellent customer service. The timeframe in which you respond to them is part of that service.
So, with excellent customer service in mind, we think a good response time is anywhere between one hour to one day, no longer. At the very least, you should do the same thing as you would for your customers and say something like “Hey, I’m working on this, let me get you a better answer tomorrow.” That’s better than a slow response.
The reason we say this is because it has been a really frothy fundraising environment over the last couple of years but times have gotten tougher. This means the relationships between founders and their VCs are more important than ever.
Why your VC is so important; why a fast response time matters
There are numerous reasons why your VCs deserve to be treated as your most important customers:
- Funding. Your venture capitalist is investing their capital to help you build your dream company.
- Reputation. Your VC can help you with calls, introductions, and critical advice. They’ve done their diligence on your company and they understand what you’re doing. Their network can be invaluable.
- Additional investors. Again, your VC typically has extensive contacts among other VCs that can help you the next time you’re fundraising. .
Your venture capitalists are key players in your business success and your response time should reflect that.
Other tips for building a great relationship with your VCs
Besides a quick response time, a couple of other things we really encourage to help build great relationships include:
- Always answer phone calls. By answering the phone every single time the board calls you they understand they can always call you if they need to. This will build a really strong relationship that isn’t just via email – of course you should expect emails all the time, but a phone relationship is far more human.
- Open conversation. Another thing that can build an excellent relationship is by keeping communication open and flowing. This steady dialogue means the VC doesn’t have to wait until the next board meeting before they can ask a question, make a customer introduction, or support the company. It’s a highly beneficial strategy.
A lot of founders in recent years have made decisions on who they were going to work with based on valuation. However, now is the time where strong relationships with venture capitalists can make a huge difference, and we really encourage doing what you can to achieve them.
Keep your VC in the know
Following on from the second point, having conversations with your VC is really important because you are keeping them and their partners in the know. Remember, they have customers too. The other partners in a VCs partnership are really important to them. If your VC doesn’t know what is going on with your company they can’t help when you need something like abridge round from their partnership.
In addition, their investment track record is important to VCs. They need to be able to communicate with limited partners (LPs) and let them know who is doing well, who isn’t, and who is getting a little bit of extra help from the partnership.
So remember, treat your VCs like your most important customers. If your customer called you, you would call them back and help them. You need to do the same thing for your venture capitalist. You’ll reap a lot of benefits, like advice and help with additional funding.
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