This somewhat odd scenario means that VCs are

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Often investing in "long shots" to be huge, rather than low-risk bets for more reasonable exits (for example, an 80% chance of exiting for $150 million is not nearly as interesting as a 10% chance of exiting for $1 billion). As an entrepreneur, particularly a first-time startup guy who has $3,000 in his checking account, an orange scooter and a small apartment, the incentive is completely the reverse. Fred Wilson wrote a bit about this disparity in his post on Swinging for the Fences.


In order to be appealing to a venture investo russia email list r, especially those with larger fund sizes ($300 million+), a company must be able to show a credible path to that $1 billion+ exit. Since the average VC-backed exit is actually something under $100 million, it’s a bit of a "wink, wink; nod, nod" game. Both parties recognize that a more likely outcome is something far lower, but the "sell" has to include the envision-able path to hundreds of millions in annual revenue that can yield those tremendous exits.




Again, I'll point to Fred, who wrote about the Venture Capital Math Problem (and a Part 2). Building the Pitch You can read a lot more about the catalysts for fundraising on my post – My Startup Experience: VC, Entrepreneurship, Self-Analysis & the Road Ahead – so I’m going to dive right into the process for creating a pitch deck. We started with a lot of great advice and direction from entrepreneurs who’d been down this road before and also got terrific help from the partners at Ignition, for whom we delivered a "mock" pitch and collected feedback that helped push us in some smart directions.