November 25, 2015
East Coast vs. West Coast: It Matters When Pitching Your Business to Investors
6. Pitch With Investor Expectations in Mind
East Coast investors care about revenue above all, both yours and theirs. They’ll want a complete rundown of your revenue model, and valuations and funding rounds are typically lower. West Coast investors tend to be more open-minded and interested in whether you have a clear vision. This typically correlates to larger checks, larger rounds, and a smaller focus on metrics right away.
7. Know Your Audience
This may be just me, but I find East Coast investors are more open to discussing business models that fall outside the “scalable, repeatable SaaS” model. On the East Coast, I keep my answers short and directed and don’t get into the whole backstory of the company. On the West Coast, however, I typically see a desire to hear the origin story.
8. Focus on the Market You Want to Be In
If you are creating a startup that will resegment an existing market or create a new market, the odds are better if you pitch VCs on the West Coast. Most Silicon Valley VCs are product managers-turned VCs that are looking for disruptive technologies even when no revenue model exists. VCs on the East Coast are often more conservative and look for established markets with sustainable revenue.
9. Show West Coast Investors Your Leadership Team Is Strong
The East Coast is more focused on the product-market fit and traction, meaning you need to deliver a pitch that shows you’ve developed a solution for a specific problem people are paying for. The West Coast is more open-minded and looks for strong team leadership, experience, and quality of development. Vision is bigger in the West and the dollars match.
10. Prepare Accordingly, Especially on the East Coast
Because West Coast investors are more comfortable investing in startups based on vision or founders alone, they don’t often ask for things like pitch decks or business plans for early-stage investments. East Coast investors, being somewhat newer to the game or coming from other industries, will often ask for those prior to investing. Make sure you’re prepared to follow up with documents.
11. Focus on Revenue Growth on the East Coast
I’ve pitched over 100 times to investors on the East Coast (New York City, Boston, Philadelphia) and West Coast (San Francisco, Greater Palo Alto Area, Los Angeles). In both markets, you need a compelling idea, a strong team, and traction. On the other hand, East Coast investors focus much more on revenue growth (and potential), while West Coast investors focus more on user growth (and potential).