The deals that survive this initial culling process are subjected to much greater scrutiny and due diligence. This process includes a thorough review of the deck, financial statements and projections; discussions with the founders, customers and other investors; and a review of third-party information relevant to the company, its product, and industry. Companies are eliminated from further consideration during various stages of this process and, in the end, they ultimately invest in a small percentage of the deals reviewed.
When deciding not to invest in a company, the VC always take the time to explain to the founders the reasons for the decision. The purpose of this article is to provide a review of the most common reasons why this VC choose not to invest in companies in hopes that some founders will find it helpful in improving their chances of raising capital.
Citation: 11 reasons we didn't invest in your company
By Phil Nadel via TechCrunch