Startup Pitch Story l Signaling Theories

Signaling Theories

A VC recommended a startup to our analyst…then I found that they aren’t investing in the startup.

I asked my analyst: “so what kind of signal it is?”

He said: Actually positive; they are known to have passed some of the best startups.

??

But on a serious note, GSF Accelerator doesn’t consider rejections from any VC as any kind of signal. We evaluate all startups on our own parameters.

Core Reasons that a rejection from a VC doesn’t matter:

1) Decision making at a venture firm is consensus driven, in some firms a few partners dominate decision making. Many times, a good startup is a borderline case and doesn’t get the consensus even though a partner or an analyst is extremely bullish on the startup.

2) Many times, startups pitch to VC when they are not stage appropriate. Many VCs like the team and space but want more validation in terms of traction.

#startups #investing #venture #signal #businessandmanagement