Turned Down By a VC? Don’t Take It the Wrong Way

You’ve put in the work.  By the 23rd iteration, you feel your deck is ready.  The assumptions and drivers in your financial model are up to date and make sense.  You’ve had countless conversations with advisors, board members, your management team, and others who you look to for advice.  You feel that you are finally ready to pitch investors and raise a round of funding.


Now the fun part begins: Pitching your business to a bunch of VCs until you find the right one.

Chances are, you’ve received a lot of inbound interest from VCs who want to learn more about your business and see if there is a chance to invest.  It likely makes sense to start reaching out to those folks to (re)introduce your business.  We receive these calls several times a week, and we are always excited to take them. I love getting the chance to meet new people and hear about new businesses, while having the chance to share the OpenView story.  Unfortunately, many of the conversations don’t necessarily lead to an investment.

Many times, it ends with:

Me:  I’m sorry, but we’re just not a fit for this current round of funding.

CEO:  But you reached out to me!  Now you’re telling me that we’re not a fit for one another.  What a waste of my time. Why did you reach out to me in the first place?!

Having a conversation end like this is frustrating for both parties, trust me.  On my end, yes, I did reach out to you. But chances are my knowledge of the operating details of the company are quite limited to what is divulged on the website or in press releases.  In fact, the only way to figure out whether or not we are a fit is to have that conversation.

On your side, I completely understand that you have put in a TON of work and I did reach out to you first. So, why am I then telling you ‘no?’

There may be a few different reasons, none of which have to do with your business, but rather reflect the investment criteria of the VC.  For example, OpenView focuses on expansion stage businesses. If your company is looking for capital to find a way to monetize its product, we’re probably not the right fit for you.  Maybe your company hasn’t historically grown as quickly as we are looking for.  Or perhaps, you are in the process of moving from a service to a software and aren’t far enough along in the transition yet.  As you can see, it is commonly the classic case of, “it’s not you, it’s me.”

So, here are a few pieces of advice for when you get turned down:


  • Don’t take it personally:  This is very easy to say and very tough to do. Your company is your baby and someone just told you that they have no interest in holding her.  As I mentioned above, chances are that it had nothing to do with you or your company. In our case, we are focused on finding the best-fit opportunities that will allow us to be most helpful in building a big business.  Try and separate yourself from the conversation and look at the facts. If the VC who turned you down is telling you they are not a fit today, they probably aren’t the guys you should be focused on getting to invest anyway.
  • Know who you are talking to:  Don’t have unrealistic expectations that you are going to get an expansion stage firm to invest in your pre-revenue company just because “with investment, we’ll be within your criteria in the next 12-18 months.”  While that may be true, you aren’t there today and therefore we can’t be helpful.  Do your homework on the firm before the call and find out what types of businesses they look for (sector and size).  If you know they are not a fit today, but still want to return their call out of courtesy, tell them that.  Leading off the conversation with “I know we are not a fit for given where we are currently, but I wanted to get on your radar and tell you a bit about what we are doing,” can lead to a much more productive conversation in the end.
  • Ask for feedback:  This is a great opportunity to find out what is exciting about your business and its pitch, and what needs work to be more interesting to a VC.  Use that information and continuously iterate on your pitch, deck, financial model, etc.
  • Keep the relationship open:  Just because we are not a fit today, doesn’t mean we won’t be in the future.  While your plan may be to raise one round of capital and never have to think about it again (in those cases, we may certainly miss out on a really good opportunity because of our narrow focus), there is always the chance that you may need more money to execute and take your company to the next level.  So keep in touch. I love to get updates on how the fundraise is going and how the business is progressing against its plan.


I think that having an open mind and trying to remain as objective in your response as possible will take you much further toward closing a round of funding than an emotional response. Doing that will allow you to quickly narrow down the field of interested and capable investors and keep the door open for future conversations about additional rounds at this or other ventures.

Being turned down (and turning down an opportunity) is never what you hope for heading into a conversation, but I think there are plenty of ways to keep the conversation productive and the relationship on good terms.


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