Put them on the Spot:
You need to know how the team and criticalmembers will respond under pressure. They will certainly experience a lotduring the period following funding. It is a very good idea to put them to thetest very early in the game. Nobody comes to such meetings having all theanswers to every question which will be raised. One of the things you shouldbe looking for is the ability to say ‘I don’t know but will find out’. You need toweed out those who tend to try to bluff their way through such situations.Look for tensions within the team. Do they disagree without an apparentability to resolve the disagreements? Teams that have figured out how towork productively together have a greater chance of succeeding. Remember,it is one thing if the team is well prepared for the presentation; it is another if they are prepared to build a business.
Highlight Your Needs and Expectations:
Many teams will be used topresenting to the ‘choir’. Your needs and perspective may be somewhat newto them. It is normal for entrepreneurs to see their company in terms of itstechnology and advantages over competition. But you will be looking at it asan investment. This need goes well beyond what might be presented inspreadsheets. Every seasoned investor knows that these projections arenever accurate. Key members of their team need to understand that you arein it for the return on your investment. It the team does not understand howyou are approaching investment in their company, problems are certain tooccur with deviations from expectations. It is important to have a very clearunderstanding of those metrics that guide your decision and expectations.
Ask the Hard Questions Early On:
Your decision process is probably goingto center around a relatively short list of key questions. Some of them will beanswered by simply being asked. Others will depend on your impressions.But, if you are going to stay on solid ground, you need to gather reliable andthoroughgoing answers to them all. A very good idea is to share most of them at the beginning of the meeting. “This is what we need to learn as aresult of this meeting?” Be particularly sensitive to attempts by thepresenting team to reduce the importance of any of these questions. Takethat as a lack of seriousness and involvement in the process. Remember thismeeting is fundamentally about you and meeting your concerns.
Avoid Answering Questions about Results:
Your normal process willinvolve an extend subsequent discussion of findings, impressions and howwell the investment opportunity fits your objectives. You may want toexpress an interest in continuing the discussion, but any expectation thatyou will be making an investment decision as a result of a first meeting is