There is a time for long, flowing prose. Cold emails to people whose time is worth a lot of money isn't one of them.
For nearly all the 800 or so, I started with something very short, e.g., an executive summary or an elevator pitch. I gave a sample below at
https://news.ycombinator.com/item?id=15283099
and will repeat it for you here:
--- Executive Summary, Elevator Pitch ---
There are about 3 billion Internet users in the world. There is a problem (I can explain very quickly but won't explain in public yet but have explained to lots of VCs) that is pressing for essentially all those users but so far solved at best poorly. I have developed an excellent, and the first good, solution, now in software about ready to go live. Ballpark, good users will visit my Web site solution a few times a week, and from simple arithmetic the company should relatively soon be worth ballpark $1 T.
That pitch or anything like it, just that, or with more below, as text in e-mail or in a nicely done PDF foil deck, revised dozens of times, polished, etc. is a non-starter. No VC in the country will touch it with a pole 5 miles long.
My other posts to this tread today have some guesses just why.
When I first considered VC funding, I had some projects that needed some equity funding. No VC wanted to fund those projects.
So, I cooked up my present project with planning that I could take the project to live on the Web, good revenue, plenty of revenue for rapid growth, with that growth plenty of revenue for much more rapid growth, ..., all the way to a very successful company and, maybe exit and lots of financial security for myself and my family, all as 100% owner with no equity funding at all. Well, I'm nicely on track for just that, with the software in alpha test and essentially ready to go live.
I just didn't want to depend on VCs or report to a BoD.
I still have some interest in VCs as, say, backup in case of some financial emergency or just as sources of feedback.
But I've found that VCs essentially, it's easy to conclude, just really hate everything about my work! Everything! Really hate!
I wasted a LOT of time contacting VCs, for all the projects I've tried including the present one. My view is that VCs have Web sites that mislead entrepreneurs, get the entrepreneurs to contact, often strain to contact, VCs, and then the VCs, finally apparently with perverse pleasure, just ignore the entrepreneurs. The claims on the VC Web sites are 90+% total BS.
So, I didn't get pissed -- I got way beyond pissed.
But I've mostly gotten over being pissed -- I just accept that VCs are a bunch of losers that, on average, actually are not making much money.
So, here on HN, in response to the OP, I am responding to warn other HN entrepreneurs that mostly VCs are just a waste of time. Even if you get their check, you have to put up with them on your BoD, and that's not going be a picnic either.
> Ballpark, good users will visit my Web site solution a few times a week, and from simple arithmetic the company should relatively soon be worth ballpark $1 T.
VCs almost certainly hear this kind of claim multiple times a week and are thoroughly experienced in how frequently this turns out to be true (practically zero) - hence without some kind of demonstration or hook they can anchor themselves to, it's going to go straight in the bin.
Then the question is how the heck to solve the problem, and why I have a solution and no one else does. The answer there is my original applied math. Sorry 'bout that, but I'm fully capable of doing such math, have done good original math back to high school, and have a Ph.D. from a world class research university and peer-reviewed publications as evidence. For the e-mail I sent SUSA, I included a PDF of one of my papers that clearly shows good math ability; I included the PDF and also the reference to the paper on the shelves of the research libraries. The journal for the paper? Information Sciences, an Elsevier journal. Fully serious stuff.
Exceptionally good projects are what the VCs need, e.g., "another Google", and that's what I write them about.
To take my claims seriously, sure, the VCs and I would have to communicate further. E.g., one poster here says that my pitch should be about five words on one, line, short enough to be just the subject line of an e-mail. I've done that, too, e.g.,
$1 T Quickly
or some such with the e-mail body with an elevator pitch of just 2-3 sentences. That gets ignored, too.
IMHO, a lesson for HN people if they want is what I did or didn't write is just irrelevant. Instead, nearly no VC will ever read an unsolicited e-mail. They all go "straight to the bin".
For the really solid evidence of "demonstration or hook," that would be when I have $2 million a month in revenue, right? Then they can give me a call, and I will look up when I wrote them and told them what I was doing that they ignored. So, I'm at $2 million a month, and they want to buy 30% of my company for a seed round of $1 million? And I should be thrilled by that?
> VCs almost certainly hear this kind of claim multiple times a week and are thoroughly experienced in how frequently this turns out to be true (practically zero)
Right. So, they'd be a lot happier if I projected only 1 million good users instead of 1 billion, a company worth $1 B instead of $1 T? I'd be just the same: Again, once again, the VCs ignore unsolicited e-mail messages, no matter how short, long, rough, polished, etc. The VCs believe that any entrepreneur who sends anything to info@BigVC.com is a fool. Maybe so. But, who is the fool, the entrepreneur or the VC who invites entrepreneurs to send to a black hole?
E.g., as elsewhere in this thread, SUSA claims to "seek out" good startups. Well, they don't "seek" very far if they ignore their e-mail.
The US is awash in people and institutions that can do really accurate evaluations of projects described just on paper. In fact, they insist on descriptions on paper, and projects that pass such evaluations are high payoff and low risk. Examples include GPS, Keyhole, the H-bomb, stealth, and much more. High end engineering projects are done that way -- on paper. There is hardly a single VC in the country qualified to evaluate such papers. For the organizations, e.g., NSF, DARPA, ONR, Army Durham, Air Force Cambridge, CIA, NSA, etc. hardly a single VC in the country is qualified for such a job. The core technology comes from the best US research universities, and hardly a single VC in the country is qualified for a faculty slot at such a place. For commercial work, the IBM Watson lab is comparable, and I've been a research scientist there on an AI project, wrote and gave a paper at an AAAI IAAI conference at Stanford, etc. There's hardly a single VC in the country qualified to do that.
There are not very many projects good enough to be "another Google", and the ones that are the VCs can't evaluate.
So, I have a lesson for HN readers: The VCs are not good partners in a technology project and won't read their e-mail. For warm introductions, they don't know the right people.
* It needs to be specific on what you are building. The Stripe blog post talks about that and gives good examples.
* Avoid flowery prose like your first sentence, and "BTW speak" such as inside the parentheses.
* Avoid talking about or implying the need for an NDA such as inside the parentheses. That is the fastest way to get ignored.
* Avoid unrealistic claims like the company being worth $1T. In fact, avoid talk about company worth all together however saying my market is X and the market is worth Y is good as long as the numbers are based on research.
Why not make any difference? (1) They will nearly never pay any attention at all to unsolicited e-mail. (2) If they do read anything, they will essentially always look for something about traction and not seeing that will junk the e-mail.
The reactions about traction are so uniform that I have to conclude that they all have a common source, and that would be VCs agreeing (required to agree) with their LPs, and the LPs coming together to agree on traction, etc.
I don't write such involved prose to VCs with, e.g., lots of details in parentheses. I accept that VCs want to zip through text at about the fourth grade reading level.
I've never mentioned an NDA to a VC, and I doubt that a VC would want to look at my core math or have it reviewed outside -- my guess is that VCs just don't do that. I mention the math because without it there's no way known to accomplish what my work does.
For the $1 T, that's easy enough to justify at the back of the envelope level: Assume 1 billion people connect for a few sessions a week with each session from a few minutes to 30 minutes or so. On average, each session shows them about 5 ads per page for about 20 pages, 100 ads. Assume the Mary Meeker $2 per 1000 ads displayed. Assume a reasonable P/E. Multiply it out for yourself. If assume more, especially better ad targeting, which my data and math permits, then can get several times $1 T. For a back of the envelope estimate, the $1 T is fine. Look, it's simple: My work is an excellent, the first good, solution, so far with the best solutions poor, for a pressing problem for essentially every user of the Internet in the world. We're not talking niche here, or just teenagers, or just dog lovers, cooks, restaurant fans, etc. For the more advanced countries, get maybe as a standard Internet application 1 billion people. Then multiply that out. There's nothing outrageous about the $1 T.
Okay, I'll do the back of the envelope arithmetic for you:
Assume 1 billion users from the more developed countries. On average each connects to the site 3 times a week. Each connection lasts on average 30 minutes where they see an average of 5 standard sized ads per Web page and see 20 Web pages. The revenue is KPCB Mary Meeker's $2 per 1000 ads displayed. So revenue is
12 * 1 * 10**9 * 5 * 20* 3 * 4 * 2 /
1000 = 28,800,000,000
Assume have 40:1 P/E (I'm ignoring tax details here) for a market capitalization of
40 * 12 * 1 * 10**9 * 5 * 20* 3 * 4 * 2
/ 1000 = 1,152,000,000,000
With the good data from the users and some more math of mine, I should be able to do better ad targeting and get, maybe, $6 per 1000 ads displayed for market capitalization of
40 * 12 * 1 * 10**9 * 5 * 20* 3 * 4 * 6
/ 1000 = 3,456,000,000,000
There are some options for some virality that should raise the 3 visits a week to 6 for
40 * 12 * 1 * 10**9 * 5 * 20 * 6 * 4 * 6
/ 1000 = 6,912,000,000,000
Gee, it's just simple arithmetic.
With some resulting changes in culture, such as we've seen often enough in information technology in the last 10-20 years, the numbers could go several times higher, but I'll omit that.
Okay, I only get 500 million users and only $3.5 T.
Lots of people see the problem; they don't say anything about it because they see it as like death and taxes, something that can't be fixed. They assume the problem can't be solved because they don't have even as much as a weak little hollow hint of a tiny clue about how to solve the problem. That's common, standard: E.g., Henry Ford said "If I'd asked people what they wanted, they would have said a faster horse." Well, they didn't believe in a faster horse and had no clue about a car. So, they didn't say anything. It's that way on the Internet now; people don't see a solution so don't say anything. Same for the Internet itself before the Internet.
Uh, some original applied math processing some good data can be some good stuff. The US DoD has known that for a long time; so has the NSF; VCs have yet to learn this lesson.
At one time a VC could have had 20% of my company for $500,000. Not now!
That would have been
0.20 * 3.5 * 10**12 / 500,000 =
1,400,000
Lesson to HN readers: VCs are low quality people, losers; don't waste time with them.
I'm no longer looking for VC funding; it's hopeless. I don't really need VC funding. So, my point here is to do a big favor for HN readers and push back against a lot in the OP.
Now, imagine what your priors are as a VC. Do you (a) believe this person's claim that he's capable of making a trillion dollar company soon, or (b) think he's a supreme bullshit artist, delete the email, and never think about it again?
I know this "prior" stuff, Bayesian stuff, has a lot of respect here on HN, but it never did make much sense.
So, I should send the VCs some information that indicates I'm serious and credible. For a technology project, I do have credentials, far above those of hardly any VC in the country -- especially now that Chris Sacca retired, and I did complete my Ph.D. and Chris didn't complete his.
E.g., for credibility, SUSA says that they like to see some surprising accomplishments, big things done quickly. Well, I posted a list, (A)-(I) or some such here, and included some of those when I wrote VCs.
Here's my point for HN readers who want it: VCs don't read unsolicited e-mail messages. Since they junk such messages, it doesn't matter what is in them. VCs like warm introductions, but we don't know the same people. By the time my project looks good to VCs, since I'm a solo founder (they don't like that, either) with meager opex, I will have plenty of cash for rapid growth. E.g., if my company really is growing, then $1500 in server parts can generate ballpark $200,000 in revenue a month. Just multiply it out assuming 400,000 bits per Web page, 5 ads per page, $2 per 1000 ads displayed (from the Mary Meeker reports), much more with good ad targeting of good demographics, etc.
How many long, unsolicited, rambling emails that don't get to the point do you bother reading?
http://www.kauffman.org/newsroom/2012/07/institutional-limit...
on average the VCs have not been making much money.
My typing here is long enough to provide evidence enough to make my points. Just short assertions with no evidence are not meaningful.
VCs are commonly treated as heroes, the smartest people in the room; maybe you are upset to discover they are not.
I feel that may need to be rectified
Uh, my purpose here is to respond to the OP, not to raise funds from VCs.
I gave the elevator pitch just as an example of what, with what you want that is missing in what I gave here, VCs totally ignore.
I also gave my best argument for why they ignore: They refuse to read unsolicited e-mail messages. They insist on traction. Nearly all applied science and engineering are funded just from paper evidence, but VCs don't do this. Why? My guess is that their limited partners (LPs) don't so permit. Or, the LPs want something closer to a tangible asset that has market fit and not just paper. Okay.
The OP did not make this point clear, and to me for information technology VC funding that is the most central point of all.
But for a sole, solo founder with a good project and tiny opex, by the time a VC is ready to write a check, such a founder will no longer need, want, or accept it.
My purpose here is to respond to the OP and warn HN readers.