Why do we provide specific feedback to all investment applications?

Fundraising is a complex and laborious task for founders. We believe there is nothing more frustrating for entrepreneurs than investing time and energy to craft a compelling pitch deck, reach out to VCs in a personalized way, and, in the end receive a standardized email in return or even no answer at all.

When entrepreneurs receive silence or vague reasons for the decline, all parts involved are affected negatively.

Founders do not understand exactly why they were declined and as a consequence do not have a clear vision of what to improve.

On the VC side, consequences are subtle but painful in the long term:

• Will a VC deal-flow pipeline remain healthy in three, or four years if the firm does not allocate time to provide honest feedback?

  • If a VC firm does not provide clear feedback to the founder and to the LP, incubator, or friend who made the introduction, the referrers might feel discouraged to keep referring deals.

• How will the ecosystem perceive a VC firm that goes silent or generic it doesn't move forward with a deal?

  • Perception is reality. If the VC is perceived as a firm that does not even take the time to contribute with honest feedback, who will want to co-invest or collaborate with the firm in the long term?

Here at SaaSholic we appreciate investing our time to provide reasonable, logical, specific, and genuine feedback to all entrepreneurs that invest time applying for an investment, that is our essence.

VC firms have DNA and every touchpoint with LPs, entrepreneurs, or anyone in the ecosystem shows the essence of the firm. At SaaSholic we are intentionally value-add in every single interaction because being open and frank is good not only for the entrepreneur but also for us.

When we share feedback, we are challenged to structure thoughts and decisions in a logical framework. This exercise makes us more rational and allows our team to have a clear vision of why we are making decisions. Furthermore, by structuring the rationale and sharing it, we allow ourselves to be criticized and learn or even reconsider our decision.

Yes, it does take time and energy. But, we believe that by being plainspoken, genuine, and specific we contribute to the LatAm ecosystem since here there is an unspoken culture of avoiding bad news or “hurting someone’s feelings”.

If the VC market adopted honest and specific feedback, the ecosystem would run at a much quicker pace.