Backup & Beyond (mostly beyond)

I keep getting emails from VC firms at regular intervals. I have had initial phone calls with many of them. But invariably there is no progress as we just do not act on raising money on our own because I fundamentally cannot get myself to pitch my business to a VC just to raise money. The reason is that I am uncomfortable doing a business plan on how I will scale the company.  Because until we try something out we will never know whether it is going to work or not. It is always continuous experiments you run and figure out ways to grow and scale. I am kind of tired trying to be polite and diplomatic with VCs, i.e. responding to their emails and taking their first call and then not taking any initiative in raising money. Couple of days ago when someone was persistent about having a call after I turned down a request for a call, I sent the following response. I want to post that response publicly and I am going to point all VCs who contact me to this post from now on.

“I don’t want to sound arrogant. It is not lack of time. I am pretty jobless trying to figure out ways to scale our company trying various new things. The problem is the serious lack of interest in pitching my company to investors. I have spoken to so many VCs on the phone. It’s always the same. I refuse to do a business plan projecting how we can scale. It is like an experiment we are running and it is against my personal nature to pitch my plans to investors – just to raise money – as something that will work without fail. VCs don’t understand my perspective and I can’t blame them as they have to justify their investments to their LPs. I cannot change my nature and personality just to raise money.  If anyone is interested in my company I prefer a one on one meeting. But I insist that I will not give a business plan nor I will pitch my company to raise money. The investment has to come because they instinctively trust me and have a somewhat religious belief that I will at least give their money back if not grow it by 10 times. That is the understanding with which our angel investors have invested in us, by the way. One of them is a VC and he thinks personally he has no problem with my style but as a VC he cannot convince his other partners. My yard stick for success is different from the pure professional investors.”

The above post was written by Sekar Vembu of Vembu Technologies. Vembu Technologies is a backup software vendor whose product, StoreGrid, powers the online backup services of a large number of service providers across the globe. Besides remote backup, StoreGrid is also used for on premise backups of workstations and servers at various companies & universities.