After reading our Investment Areas Thesis, you may be asking yourself what I should be preparing for in a meeting with Grossman Ventures. First of all, you are most likely to be talking with Jeremiah Grossman and/or Robert “RSnake” Hansen, who have >25 and >30 years of information security and business experience, respectively. We take a very pragmatic approach to investing and really focus on where the puck is going, not as an industry necessarily because whole industries can be disrupted by the right product, but we take each company as it is today.
One thing we have found is that most VCs do not publish the list of questions they ask during the intake process. We think that’s unnecessarily hard on the team, especially for new entrepreneurs who are just trying to impress VCs enough to get their idea off the ground. The sad reality is that most ideas are not worth funding, but mostly because they didn’t properly think through one or more of the things that VCs tend to ask, and they get caught flat-footed and unprepared. We don’t think it should work that way. We want our entrepreneurs to have as much ammo as possible for what is typically a pretty tough set of questions.
So without further ado, here are the questions we tend to ask:
- What problem are you trying to solve?
- Who are you solving the problem for?
- How did you originally come across the problem? Why YOUR team specifically?
- Why solve THIS problem out of all the others?
- If the problem were to be solved, what would the customer impact be?
- What is the solution?
- Can we see a demo?
- Can you tell us about any design partners? What are they telling you?
- Who are the key competitors?
- Why is your solution difficult for competitors to copy? What's the moat?
- What is the size of the market?
- If you have customers, what is preventing you from doubling your existing business?
- How much capital are you looking to raise?
- How much have you already raised?
- What are you planning to do with the investment?
- What is your go-to-market strategy?
- Could a product warranty be offered for any aspect of your business?
One thing we try to do is be very honest and open with our potential portfolio companies, which can be a little harsh if you’re not used to it. But it’s with the intention of making you better, or helping you avoid what might be a tragically bad decision - to raise money for a company that won’t survive in a very competitive market. Don’t be afraid though, we want you to win. We’re on your side, actually. We just don’t want you to suffer unnecessarily, so our questions are designed to elicit the information we need to know to determine if you are capable as a team, but also what the market realities actually are.
