Comments on: K4

By: Ashley Tom

Ashley Tom — Wed, 04 Nov 2009 22:59:22 +0000

It is bizarre how much people will pay to pitch their product. Although, it does tell you a few things about the product if they are willing to pay that much for 20 minutes to sell it. First, it tells you that they are confident in the product like JamieA said. Second, it sets the tone that it must really work. Third, the guy that is representing the product better know what he is doing, how the product works inside and out, and how to think on his feet. I think that having such a high fee makes it impossible for the everyday geniuses that come up with amazing products in their workroom. Not everyone has the connections and investors to invest in their ideas and inventions, which makes the market so tuff and almost impossible for “John Doe” to succeed. Most people spend every dime they have just in creating the product.

By: JamieA

JamieA — Thu, 14 May 2009 06:44:10 +0000

I think that K4 is meant to weed out those who are not committed and might be wasting the time of others in a sense. I think that any business must invest its own money to advertise and before it begins to grow so the fee process does not necessarily bother me. If they are willing to pay to pitch their idea then they are more than confident enough that they will receive positive outcomes. It was interesting to hear that only ten minutes was given to pitch and then another ten to answer questions and concerns. Plus, the time limit was strict and this helps to ensure that everyone gets a fair shot at promoting their own ideas and products.

By: BrookeM

BrookeM — Wed, 13 May 2009 15:14:29 +0000

K4 seems like an excellent program. The initial fee might seem like a lot, but it can defer ridiculous, unserious people from pitching their idea to investors. It is just like other fees that we all must pay if you are honestly serious about the end result. This field is all about taking risks and believing in your product. The entrepreneurs put their heart and soul into the product in order for it to be a success. This process is very interesting to observe because the habits and processes that some people morph into shows in every aspect of their life. They might changed their family dynamic and overall environment in order to try to launch their product.

By: SeanC

SeanC — Wed, 13 May 2009 07:42:22 +0000

It might be expensive, but it is also worth it to pay the price to “put yourself our there” for others to discover you. Even if you have a product and at least one buyer does not mean you will succeed. If you go through a program like K4 you have an opportunity to learn about your product and how others will view it. It is also good to practice selling or pitching or idea with great feedback. Things do not get better or you do not get better at something without any type of feedback. I have participated in something similar but instead of pitching a business, research (thesis) was being pitched. It was almost the same format where you get a certain amount of time to present and the questions afterwards. This gives a chance for a person to defend their research and also gathers ideas that might have not crossed their mind that will help further their research. Main point is get the feedback, it will help better yourself or your product.

By: anthroguy

anthroguy — Sat, 28 Mar 2009 23:03:43 +0000

Thanks for the comments, John. The Funded is a pretty cranky site in general. But, there are some calm, balanced and positive comments about K4 on The Funded. I agree that gathering a bunch of people together is a great service and as I said at the end of my post, the pitch fee strikes me as a good investment.

By: John Matthesen

John Matthesen — Sat, 28 Mar 2009 21:37:53 +0000

Dear Anthroguys:
You selected some particularly snarky comments about K4 from The Funded site.
To be sure, there has always been lots of debate about whether an angel group should charge a fee to presenters or not. Ideally presentations would be free at all groups, but consider – the efficiency of getting in front of several hundred angel investors all at one time.
If you’ve ever tried talking to potential investors one at a time, it can take a verrrry loooong time. Just reaching people by phone or email is tough. To actually present to even 20 people can take several weeks of attempted scheduling. So in perspective, if you spend say $3,000 and you can raise $300,000, that’s a 1% commission. Very inexpensive if you think about your time alone. How many entrepreneurs have weeks and weeks to spend making presentations?
Meanwhile, the cost of gathering lots of angels into a single location requires staff, screening of applicants, renting large rooms or auditoriums, and many other details not seen, but essential to the process. Who should bear that cost? I leave it to the reader to decide, but be certain that the costs are not zero. They get paid by someone.
The other comment about expecting VC’s to fund a company once they have customers shows a lack of understanding of the VC world, and of investing in general. I often meet entrepreneurs who are surprised, even angry, when investors are reluctant to jump at their deals. Certainly many investors can ask a lot of annoying questions. And if you think angels are tough, spend time these days with VC’s. Trust me, they aren’t there to toss money at you, even if you do have a customer or two.
As an entrepreneur, you have to understand what it’s like to be an angel investor. You are asking someone who has enough money to take a chance, but typically not enough money that they really want to lose it. Sure, everyone says don’t invest if you aren’t prepared to lose the money, but in reality, very few of us will ever be talking to investors who have so much money they can afford to lose it. Those days disappeared with the dotcom boom.
As both an entrepreneur and an angel investor, I encourage everyone to keep perspective. Investors need to look for ways to help their selected entrepreneurs be successful, and entrepreneurs need to remember that they are asking somebody to enable their dream with very little chance of return.
Lastly, regarding sites like The Funded, take a look at the message that pops up on their site this week:

Conclusion: Investors are Great
“On Friday, March 27th, TheFunded, Incorporated (‘TheFunded’ or ‘we’ or ‘the Company’), in conjunction with counsel has concluded that venture financing and the purchase of preferred equity, herein referred to as ‘investing’ or ‘investment’ or ‘investors’, is both broadly and generally good for companies worldwide.

TheFunded will officially cease reviews on April 2nd, 2009, which, from time to time, reflect negatively on the many innumerable benefits of investors or investment or investing. We encourage companies to consider seriously taking investment, and we apologize for the following statement made in haste:

“investing is predatory”, “over 75% of investors are bad”, “avoid banned investors.”

The Company further apologizes for making any other statements and causing questions to be raised regarding the ethics and the good reputation of investors. Further updates are forthcoming Wednesday, and we encourage every Member to take an investment and then post feedback on the positive and rewarding experiences in Open Letters. Thank you.”