1. Talk to the right person
We studied a case where the protagonist spoke to the “Internal head for magazine development” and got politely told to disappear. 4 months later the protagonist speaks wi the Editor-in-chief and leaves with a term sheet. Moral of the story: make sure you speak to the right person who has the power and whose interest is aligned. The internal head probably wants to do it themselves and doesn’t want you to do their job for them. The editor-in-chief wants the best magazines.
2. If someone is willing to give me money, it is NOT necessarily a good idea
In this frothy venture environment, you really only want to be accepting money from experienced investors who can really get you some place. There’s no point receiving money from someone with no experience to get you to where you need to go.
3. Don’t haggle over the terms, focus on people
When VCs/entrepreneurs haggle too much, there’s a sense of mistrust which seeps into the relationship. This sets up for a bad relationship, the VC doesn’t work hard for you, their network isn’t tapped. You don’t get the marquee Board, advisors or customers and the likelihood of your failing stays at 99%. When you search for investors, search for someone you’re willing to be married to for a while. Focus on the people on the other side of the table, not the money.
