Let’s face it, as a founder looking to raise capital, most VCs are going to tell you no. The vast majority of VC firms invest in less than 1% of the deals reviewed, so don’t get discouraged. Use those rejections as motivation. To maximize the value from each interaction, ask VCs who decline to invest three questions:

May I put you on our investor newsletter?

This is an efficient way to keep fence sitters and curious prospective investors informed regarding your progress. As you hit milestones, you may see a few of the NOs reach back out to you unsolicited.

Now that you know more about our business, are there any VCs you recommend we pursue?

All VCs network with other VCs, and most are familiar with the investment criteria of the VCs with which they network Many time-starved VCs may not think about referring you out unless you ask, so ask at the point at which you are declined since your deal is fresh in their minds.

What challenges do you see in our business that may prevent us from raising capital or accomplishing our goals?

VCs are trained to be nice and not ruffle feathers. Many times you’ll get a generic reason for declining to invest (e.g., too early, doesn’t match our thesis). There is no upside for them to upset you as a founder. Doing so simply reduces the chances you come back to them for your next deal, and you may potentially trash their reputations to others in the startup ecosystem. This question will help you smoke out some candor from the minority of VCs who are willing to tell you what they really think.