Investors love to host podcasts and write blogs on what startups ‘should’ do. Or what other investors ‘should’ do. It’s usually meant with good intentions, but we know it can sometimes be a bit tone deaf and sanctimonious. There is a reason the ‘VC’s congratulating themselves” twitter account exists.

This is not one of those posts. Here is some real talk about an area we weren’t doing well at within Main Sequence and what we did about it. And where we would love your help.

About 6 months ago we asked the startup community for some feedback on what it’s like to engage with Main Sequence, so that we could work out where to improve. To say some of the feedback was humbling, would be an understatement. There was some great feedback, but there was also worrying feedback such as that we ‘ghosted’ founders — that is either taking too long to review their pitch or dropping off responding at all at some point through the process. 

Given that is like a sales team ghosting customers who want to buy their product, this is obviously just. not. good. enough. 

We talked about it as a team, and while there were a bunch of rational and understandable reasons why this might be happening, the reality is we needed to fix it. When we analysed our CRM and process, the harsh numbers were that we were taking on average, about 6 months to get to a ‘yes’, and about 1.5–3.8 months to get to a ‘No’ for founders. 

We operate in deep tech across every conceivable industry sector, so it’s understandable that reviewing opportunities might take longer than say, a B2B software fund, because it takes more time to really understand the technology, its competitive advantage where it fits in the landscape. But for founders that can be just too long to find out whether they are a fit for us, or not. Every time they engage with an investor, it is a time investment, and while all parties know most investors will say ‘No’ — after all, like most venture funds, we invest in maybe 1% of all the companies we see — you hope that the investment of time has still been worthwhile. Hopefully, a founder learns something from the interaction, or gets some useful feedback.

One of the things we often try to help our founders and startups do, is work out where a process is failing, experiment, ensure there is someone with accountability in the process and then measure. We do this with sales and marketing, manufacturing and many other areas. It was time for us to eat our own dog food, and use our own advice. 

The experiment we tried was to make a single person accountable for making sure new opportunities were being reviewed — we see over 1,000 opportunities a year, this is not a small feat. This meant doing a first triage for eligibility, responding within a timely manner to exclude them and then farming out the opportunities that were viable to the different challenge squads (we invest across 6 challenge areas) for further evaluation as a second stage — this optimised the opportunities that were being looked at in depth and reduced the overall workload for any one individual. Those squads met fortnightly and then would follow up with a meeting, respond asking for more information, or decline. The same single person whose role it was to undertake the initial triage, was also responsible for monitoring how opportunities were moving through the deal funnel in the CRM system, and if there wasn’t much action or movement, nudging the team to keep it moving. 

Then we measured. After 6 months, we had managed to get our time to ‘no’ down to 10–56 days (depending on where it cycled out of our process), and our time to ‘yes’ to 3.5 months. And this is a vast improvement. 

None of this is rocket science, but it is sobering how little we had to change, to make sure it improved. 

There are many, many other things that we want to work on to improve what we do at Main Sequence. We know we can do many things better, and want to be the best partners in the ecosystem that we can be. So the ‘ask’ is that we would love you to contribute to providing constructive feedback to us, via this link here. If you have engaged with us in the past, and would like to help us with feedback, we would love to hear from you.