Raising Money

Rejections from Investors: They Teach you a Lot

Rejections hurt.

Those rejection letters can discourage you, hurt you, and procrastinate your dream to set up a startup. Without investment you can barely get started. Without finances, starting up can be difficult. What can you do when you face one rejection after the other from investors then? You can learn from them.

First Lesson: Read Carefully

Don’t just read the first line of your rejection letter and learn the reason behind the rejection. You may think that one-word would have been enough but there is actually a reason why you are sent a long letter. When you read the entire letter you will understand just where your business is flawed. Take that into consideration and improve your business.

Second Lesson: Don’t take it as an Absolute No

Some VCs will reject your business for the simple reason that you have just started off and you haven’t progressed enough in your business to be funded. This rejection is not all that disappointing. It is an indirect ‘may be’. You can very well apply to these VCs later on, after you have gone a little farther in your business.

Work towards your purpose and goal, and apply.

Third Lesson: Use them to your Benefit

Change your perspective. Don’t look at the rejection letters as something that you should be ashamed of. Since the VC rejection letter points your flaws out, you know where you are going wrong. You can use that to improve your business. This will not just help you find a VC but it will also help your business tread the right path!

Don’t take the rejections personally. Remember the fact that they help you improve in various ways by letting you know where you are going wrong.

Fourth Lesson: Follow Up

VCs will really appreciate it if you take their feedback seriously, work on the issues they mentioned, and come back. This shows professionalism, which is valued very much. Keep your rejection letters safe and follow up when you have successfully worked on the flaws they mentioned. They will not hesitate or reject you after that.

Investment is important but gaining the trust of investors can be very difficult especially for startups. Many, in the beginning, will reject you. It is how you handle the rejection that makes the difference.

Entrepreneurial Learning

Rejection from investors must be perceived positively in order to be successful in business. Learn your mistakes from those rejection letters and work on them so as to improve and prove that you deserve being trusted.

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