✌VC signaling in seed rounds

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Outline: VC signaling in seed rounds

1. VC signaling in seed rounds2. Chris Dixon bio3. Mark Suster bio4. Naval Ravikant bio5. 3 guests, 3 different types of funds6. What stages of investment does a startup

go through?7. The $ amount in a round changes based on

the public markets8. Seed investors make decisions quicker and

ask for less control with simpler documents

9. The cast of characters you run into when you're raising money

10. What is VC signaling?

Outline: VC signaling in seed rounds

11. VC signaling is when insiders convey information through their actions

12. Investors aren't the only insiders who can signal

13. VC signaling is the action or lack of action of people who have information you don't have

14. Investment decisions are often influenced by social proof and momentum

15. Social proof short-circuits investment decisions

16. Social proof is rational17. How do investors transmit signals?18. Typical investor signals19. When signaling matters

Outline: VC signaling in seed rounds

20. All VCs talk to each other — you can't keep them apart

21. If you hear 5-6 people passed, you're predisposed not to like it

22. 4 types of investor signals23. In the good old days, supportive investors would

always do their pro rata24. Supportive investors still tend to do their pro

rata in the Series B25. Funds can establish norms and stick to them26. Does GRP have a follow-on policy?27. Do early stage funds do selective follow-on

rounds?28. There's a difference between focused seed stage

investing by VCs and shotgun seed investing by VCs

29. Don't give VCs contractual options on your next round

Outline: VC signaling in seed rounds

30. Taking office space can also be a signal31. If my existing investors don't want to

invest, how do I talk my way out of it?32. Does a VC work against you in the Series A if

they don't buy enough of the company in the seed round?

33. What are the pros of taking seed money from a VC?

34. Anything I missed that I should have brought up?

35. How to take an option-style investment from a VC

36. What's your favorite blog these days? 37. What's your favorite life hack these days?38. Get intros to seed investors with AngelList

VC signaling in seed rounds

Chris Dixoncdixon.org@cdixon

Mark Susterbothsidesofthetable.com

@msuster

Naval Ravikantstartupboy.com

@naval

3 guests, 3 different types of funds

What stages of investment does a startup go through?

The $ amount in a round changes based on the public markets

Seed investors make decisions quicker and ask for less control

with simpler documents

The cast of characters you run into when you're raising money

- Individual angels- Individual angels investing OPM- Seed stage funds- Multi-stage funds

What is VC signaling?

VC signaling is when insiders convey information through

their actions

Investors aren't the only insiders who can signal

VC signaling is the action or lack of action of people who have

information you don't have

Investment decisions are often influenced by social proof

and momentum

Social proof short-circuits investment decisions

Social proof is rational

How do investors transmit signals?

Typical investor signals:

- Lead the round- Do pro rata- Do nothing

When signaling matters

- 10% company is hitting it out of the park and signaling doesn't matter

- 80% of the time the company is middling and signaling *matters*

- 10% of the time the company is a disaster and signaling doesn't matter

All VCs talk to each other — you can't keep them apart

If you hear 5-6 people passed, you're predisposed not to like it

4 types of investor signals:

- Insider tries to do the whole round- Do a little more than pro rata- Do less than pro rata- Pass

In the good old days, supportive investors would always do their

pro rata

Supportive investors still tend to do their pro rata in the Series B

Funds can establish norms and stick to them

Does GRP have a follow-on policy?

Do early stage funds do selective follow-on rounds?

There's a difference between focused seed stage investing by VCs and shotgun seed investing by VCs

Don't give VCs contractual options on your next round

Taking office space can also be a signal

If my existing investors don't want to invest, how do I talk my

way out of it?

Does a VC work against you in the Series A if they don't buy enough of the company in the seed round?

What are the pros of taking seed money from a VC?

Anything I missed that I should have brought up?

How to take an option-style investment from a VC

What's your favorite blog these days?

What's your favorite life hack these days?

AngelListventurehacks.com/angellist

Get intros to seed investors with:

Get more startup advice

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