Will They Say Yes..Or NO?

What VCs and Angels Owe to Startups

In Entrepreneurship by Ashish Sinha

“He has been sitting on it for 3 months!” 

A few days back, a startup was raising money from investors. While few angels agreed to invest, the term sheet was also shared with one investor who was supposed to invest along with others (and add further details to it).

This investor (let’s call him X) sat on the term sheet for 2 months and stopped answering any calls/emails from the startup founder. Worried about the delayed response from the startup, other angels threatened the startup that they will backout if things don’t move fast.

Apparently, X is a very busy man and the entrepreneur was left with no option but to cc one of the industry bigwigs in the next email (sort of social shame), post which X sent out a plain ‘I don’t think I am interested at this stage’. It took X 3 months to say that.


If this triggers a ‘Hey! I also have a similar experience to share’, welcome to the crazy world of investment cycles in the country.

Will They Say Yes..Or NO?

Will They Say Yes..Or NO?

Angel Networks : 3 months  |  VCs : 4-5 months.

No, I am not talking about the amount of time it takes to get funded by Indian Investors. This is the average amount of time it takes to receive NO. In fact, you are extremely lucky if the rejection time is short enough for you to plan your next move.

A startup has very limited lifeline – especially in the early days where it is going through the ‘valley of death’ phase. Add the first time founder’s fund raising (in)experience to it and you will now know that typically, most of the founders tend to rely on conversations that move beyond ‘send me your business plan’.

The practical truth is that founders often tend to NOT hedge their bets when it comes to raising money and given the stretched management bandwidth, most of the early stage startups talk to less than 2 serious angels at the same time.

What do Investors Owe to Startups?

A straightforward No. A quick NO.

A NO that need not carry a feedback on one’s business plan (that’s too much to ask from investors, because startups are not rejected for just the Bplan alone – there are several other reasons).

A NO that helps a startup plan their next move. Fast!

If NO is taking time, least investors can do is provide visibility during the entire process.

Maybe, Investors should commit to SLAs that need them to say NO within a week’s time. Agree that Yes takes a lot of time, but NO needs to happen very fast. That’s the second biggest gift Investors can give to startups (first one being a Fast Yes, which happened at #StartupRoots – but that’s an exception).

PS: Not all angels/investors are like this. Some decide in 15 minutes and tell you right on your face. But there are very few of those.

As an entrepreneur, have ever been at the receiving end? Or had a great experience with a decisive investor? We’d like to hear from you in the comments.

[Image credit : Shutterstock]