Here’s my list of 5 tough questions that I’ve been asked by VCs, according to Nic Haralambous.
1. How are you changing the world?
This is a difficult question to answer and one that you must have an answer prepared for. VCs are increasingly looking for products, services and companies that are more than just money-makers. They want you to be conscious of your environment, the world and the effect you have on your surrounding. So make sure that you have a real, truthful and sincere answer.
2. How much money are you looking to raise?
The reason that this is a difficult question to answer is that there are multiple answers that are right for your business. The first thing that you need to know is how much money you are looking for. Simple. Next is in what currency are you having the discussion (you might be talking with VCs in Germany, the USA, Isreal, South Africa or anywhere)?
3. How are you going to use the funds if you get them?
Be sure to have a very clear, concise and relevant answer for this pandoras box. If you are too vague it will appear as if you don’t have a plan and are wasting the VCs time. If you are too specific it could imply that you are too focused on the details and missing out on the big “billion dollar vision”.
4. What do your financials look like to date?
Many business owners will laugh at this question but the truth is that many startups don’t keep a good set of books. Fortunately at Motribe we do. Be sure to explain the ebbs and flows and highs and lows. It’s not as simple as “We’re doing good” or not.
5. What is your US strategy?
As an emerging markets company this question is a potential minefield of trouble. If you answer incorrectly you will lose the VCs attention. If you answer too correctly then you open yourself up to much badgering and deeper technical questions like the location of your IP, whether you are interested in moving to the states permanently, if you have ever rolled out a product in the US market before and how your go to market strategy will work and what it will look like.
Adapted from here.