Entrepreneurs should always understand how deals get done at the venture capital firms they’re pitching.
Some firms operate on a consensus basis. In this case, every partner in the firm needs to approve a deal before a termsheet is issued. This is usually the case for firms with a small number (< 10) investment professionals. If you’re working with a firm that operates in this manner, an entrepreneur will need to find a champion for their deal.
This champion is someone who believes in your company, wants to invest, and then will work to convince the rest of the partnership that the firm should move forward with an investment. The champion could be a senior person at the firm but it could also be someone at a lower level, like an associate. If you are working with a lower level person it will likely take longer for your deal to get through the firm’s process.
So, if you have the ability to get partner level attention for your deal, great. However, if you’re not able to get a partner’s attention initially (and most startups are not), make sure you empower the junior VC staffer to make the case for your company within the partnership. That includes accepting coaching from the junior VC, since they’ll be introducing you to the other members of the firm and will want you to customize your pitch to hit the key issues that appeal to the other members of the firm’s investment committee.
Other firms (typically larger ones in both fund size and personnel size) tend to grant more autonomy to partners and allow them to invest without obtaining permission from the partnership. Partners in these firms tend to have fairly focused investment themes and sectors that they pursue (for example, a partner who only covers enterprise software, or only does wireless deals, etc) In this case, you only need to convince a couple of people (the partner and the junior person who is likely supporting them) that your company is a worthwhile investment.
The bottom line is that the deal process varies by firm and it is helpful to understand how the VC firms you’re pitching operate.