Just like telling your new date that you were late because you had to go to the STD clinic, there are somethings entrepreneurs say that turn off investors.
Sean Wise has a good article here, highlighting five such phrases and why they throw up “red flags”.
1. We have no competition
2. Our financial projections are (and/or valuation is) conservative
3. We know more about (software / search / media) than (Microsoft / Google / Fox )
4. This will be our last round of funding
5. If we only get 1% of the market, then we will all be rich
My favourite passage from the piece is
This is what bugs uber-investor and investment media guru, Kevin O’Leary:
“The thing that pisses me off most about pitches is when the entrepreneur values his pre-revenue startup at $10M. I mean, I’ve seen this movie before and I know how the movie is going to end. They get my money, and I get worthless stock.”
Hear this almost everyday.