Pay to Pitch Is Predatory. So Are (Some) Angel Groups.
This article on VC’s demanding pay to pitch got me on this rant. The list of “investors” to avoid:
NEVER, EVER, pay to pitch.
That’s of ‘consultants,’ ‘investors,’ and ‘incubators’ taking advantage of unsuspecting startups and first time entrepreneurs. They’ll couch it in language like ‘mentorship,’ ‘access,’ ‘experience.’
It’s actually predatory and evil.
With a viable path and hustle, you can get money. And money is important. But the people you take money from are on your team, for better or worse, so you don’t want just money. You want a motivated teammate.
And some asshole who charges you a month of runway ($250-$750) to show up for a 7 minute pitch isn’t that. Angel groups in particular are notorious for this.
Some angel groups are awesome. Comprised of motivated entrepreneurs and the likeminded who got together to enhance their opportunities and yours. That’s cool.
Others not so much. Here’s how those look:
Some prick, usually a finance type with maybe an MBA and no entrepreneurial experience (or worse, owns 7/11′s), corrals people who want to invest but feel like they need assistance/experience/companionship. People with $200k+ income earned with minimal risk. Corporate executives, doctors, etc.
He charged them (predatory) and then turns around and charges the startups who want access to those investors (predatory). He makes a tidy sum, gets plugged into the middle of a hot/sexy community, and doesn’t care that 90% of the companies he raped die.
Dealflow is what keeps the lights on, not success.
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