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Ron Conway shares some common fundraising mistakes founders make
Ron Conway is a prominent venture capitalist who was an early investor in Google and Paypal.
In the clip below, he walks through common mistakes founders make during the fundraising process.
The first mistake he mentions is asking investors to sign an non disclosure agreement (NDA):
“We rarely get asked anymore because most founders have figured out that if you ask someone for an NDA at the front of the relationship, you’re basically saying: ‘I don’t trust you.’”
It’s common practice for VCs to refuse signing an NDA.
If you don’t want to disclose anything really confidential, you can tell them that you’d be happy to disclose that during due diligence. But also keep in mind that startup ideas aren’t worth much and execution is most important.
The other big mistake Ron sees founders make is not getting things in writing:
“The biggest mistake that I see by far is not getting things in writing… When somebody makes a commitment to you, you type an email that confirms what they just said to you. Because a lot of investors have very short memories and they forget that they committed to you, that they were going to finance, or they forget what the valuation was… You can get rid of all that controversy just by putting it in writing.”