Meeting the VCs -- During a Blizzard
By Lisa Bergson
"Are you coming next Friday?" phones professor Kevin Lehmann, brilliant inventor of the laser-based technology that my new company, Tiger Optics, licensed from Princeton University in 1995.
"For that money thing you asked me to do!" he splutters. How could I forget? But I never expected him to follow up on the university's invitation to speak, along with other faculty, before a group of venture-capital firms. Hitherto, Kevin has exhibited only the most grudging interest in the commercial aspect of our partnership. Now the VC event, Princeton's first ever, is just a week away.
"Don't worry, I'll be there," I assure him. "We've got you covered."
I don't exactly panic. We have three days after New Year to pull together a terrific 15-minute presentation for Kevin that will mark our debut before a bonafide VC gathering. Saturday, a big snowstorm insulates me from chores. I write an outline based on samples provided by my advisory board member, Don Epperson, president of Hookmedia Inc. and a money-raising maven.
RELYING ON WARMTH.
Meanwhile, other than planning my attire, I give scant thought to my own role as networker at the VC conference. I figure I'll rely on warmth and charm, as well as the listening skills I developed as a reporter long ago. Kevin is the headliner, after all. (Wrong!)
On Tuesday, I get a small team working on the overheads, while Kevin and I refine the outline. Wednesday, I go to Princeton with Jim Turner, our executive vice-president for new business development, to show Kevin the overheads. (He eschews PowerPoint as unreliable.) They're beautiful, and he seems genuinely pleased -- until we come to the financial forecast. "I can't say that!" he bleats.
"Just attribute it to your business partner," says Jim in his usual reassuring manner. But Kevin continues to demure.
"Listen!" I say, reading from an e-mail the university's director of research initiatives has sent to presenters. "Although many [VCs] will have scientific or technical backgrounds," I continue, "their perspective is unabashedly financial...."
"Oh, all right," he says. I notice that Kevin really has spiffed up his image, donning a clean, pressed shirt, with his hair and beard neatly trimmed. He's trying.
Come Friday, I somehow overlook predictions of more snow. "This is East Coast business, high finance," I tell myself, electing to don stockings instead of my usual tights, French pumps rather than boots, and a well-cut cherry-red Calvin Klein suit. Kevin and I plan to meet before the "light lunch" that kicks off the half-day event. But after picking my way through the snow, barely shoveled from the last storm, to the Computer Science Building, I can't find him. I try calling his office, my office, and Jim -- all to no avail. When he finally shows, I smile warmly. No point chaffing at the talent.
It's a bigger crowd than I expect, with the VCs and their entourages -- proposal writers, intermediaries, marketers -- in full array. "So this is what $900 million looks like," I tease Greg Olsen, the keynote speaker and a member of our technology review board. Lanky, with a big, crooked-tooth smile, he joins us to munch tasty Indian hors d'oeuvres. Having just sold his $13 million business, Sensors Unlimited, for close to a billion, Greg is the star of the show. Ironically, as he points out more than once in his presentation, he did it all without venture capital.
THE BIG PITCH.
The auditorium is hot and packed. I sit next to a young man eating a smelly giant hoagie that threatens to leak sauce and onion slivers onto my good suit. The PowerPoint projector doesn't work, and the presenters scramble for their overheads. I ignore Kevin grinning beside me.
Finally, we break into two parallel sessions: Biotechnology and Life Science, the big draw, and Photonics and Optoelectronics, which is convening across the street. So begins a series of treks back and forth between Computer Science and E-Quad as the snow falls harder and harder. "I'm going to go think about my presentation," Kevin says, just as his session starts. I smile. Better late than never.
Pleased, I note the room is full, counting some 130 attendees. Fourth to speak, Kevin jokes that he's, "after a guy who's working on a cure for cancer and before a guy who's trying to invent a new spark plug." To my dismay, when his turn comes, over half the audience files out. "Come back!" I want to cry, but I'm frozen in my metal folding chair.
Undaunted, Kevin gives a really dynamite presentation -- calm, confident, even commercial. "They have a product!" I hear a woman seated behind me gasp. I'm so proud. Later I realize that once the big-name presenters were done, concern over Friday afternoon traffic, compounded by snow, prompted the mass exodus.
"WHAT KIND OF MONEY."
After the session, we schlep back to the Computer Science building, where the presenters tack their overheads to easels for a "poster session." My dainty shoes are soaked, and I shiver in my stockings. A Taiwanese man approaches me. "I wrote down your e-mail address," he says, showing me his notes. "This technology is very interesting." Mr. Ching-Shan Lin, is a former Goldman Sachs financier now managing $100 million in "Asian" money. It's my first encounter with a prospective venture-capital investor.
"What kind of money do you want?" he asks, after I shyly tell him the amount we seek. (I simply wasn't raised to ask strangers for large sums of money.) Kind of money? I have no idea what he means. I search his face, looking for a clue. "Can I say we want 'Asian' money?" I joke. He laughs and says he'll call.
I call Don that evening: "What kind of money do I want?" "Debt or equity? You want equity."
"I'll learn this -- I promise."
It has been a couple weeks, and I haven't heard from Mr. Lin. But I've been studying up on the whole VC thing. The next time I talk to Mr. Lin or his ilk, I'll be ready.
Since my last column, I spun off Tiger Optics, formerly a division of MEECO, into an entirely separate business. I now have two companies: a 52-year-old turnaround and a one-week old startup. Please join me in two weeks as I explore what, besides money, can motivate an entrepreneur.
Before joining MEECO in 1983, Lisa Bergson worked as a business journalist at BusinessWeek and freelanced for many business publications. She received a Masters in Journalism from New York University and received Columbia University's Walter Bagehot Fellowship for economics and business journalism. You can visit her company's web site at www.meeco.com, or contact her at firstname.lastname@example.org.