Avoid the “Apply to Present” and “Angel Pitch Contest” Event Scams
calacanis.com
calacanis.com
"By charging big companies big money we can offer promising startups like you this opportunity for free"
All you need to do is buy couple of tickets for 1500+ euros and the free booth is yours.
Ouch. But we've come this far, maybe it's worth a shot...
When you get to the place you realize it's 500 startups like you, crammed shoulder to shoulder. Very few investors around...
"Shoulder to shoulder" is not an exagerration either. I think it was 50-80 startups per wall - no more than 1 meter each. Like a supermarket. Totally depressing and wrong. I actually did not meet one single investor there. But of course there are one or two lucky outliers to give a testimonial. Ugh! Stay far, far away.
My impression is startups paying their fees is their business model
I disagree. We met a LOT of investors. The important thing to note is that they won't come to you just because you're there. You have to attract them in some way (or better yet: contact them in advance and have meetings already set up).
I completely agree with the "shoulder to shoulder" thing though. It was very cramped :(
Granted, there weren't thousands of investors there, but my startup personally had a busy schedule meeting with them - that week (before, during and after the event itself) we had meetings with approx. 40 different investors.
Nowhere am I saying you should pay to pitch or pay to meet investors. I'm merely saying that whether or not an event is worth it depends on what you do at it (and beforehand) and that you can't expect it to be worthwhile just for showing up, because it won't. I found it useful, others didn't - I only wanted to shed light on why I thought it was useful and what we did to make it so.
NOTE: We also did NOT take part in the pitch contests.
I thought I was giving a counterpoint to the statement "there were very few investors" and adding advice from my experience:
The important thing to note is that they won't come to you just because you're there. You have to attract them in some way (or better yet: contact them in advance and have meetings already set up).
My other comment similarly was a counterpoint to "the only winner was the organizers", giving my experience and why I think I had the experience I did.
I'm sorry that this came across as "no you're wrong" without any details. :-(
A stand at an event designed for startup entrepreneurs should only be a valid incentive if your market is startups. If you're doing anything else then you're marketing to the wrong audience, which is a huge waste of time. Feedback only counts if it's from potential customers, or better yet, actual customers. Having 1000 people file past your stand saying "That's really clever and innovative" is a great ego boost - but that's all it is if they're not people who will buy what you're selling.
When you're building a startup you should only spend money getting to events where your customers are going to be. Go to those (often quite boring) events and sell to people. Being in the same room as a startup celebrity is far less valuable to your business than a even one single paying customer.
If you do that then you'll have no problem meeting investors. In fact, they'll come to you.
I've been at the last three Web Summits and while I don't think the stand is worth €1000 in itself, the Web Summit (including stand) totally are - but you get from it what you make of it. With sufficient preparation, Web Summit can be quite valuable. For example, in the last one we arranged meetings with both investors and potential customers weeks in advance of the event; we also printed flyers (which worked as people came to our stand saying they saw the flyers). Over all, it was very positive for us.
BUT the reason for this is that we made use of the fact that a lot of people we wanted to talk to would be in one place. We didn't just go and hope people would talk to us, we arranged it in advance (and the flyers were bonus). That made it worth a lot more than €1000 to us.
Would I pay that much just for a stand? Hell no. Would I pay to pitch? Hell no. Would I take advantage of the fact that such an event draws a lot of useful people? Yes, of course.
Note: I didn't actually bring all this up, I was just responding to all the folks writing about Keiretsu forum and Collision. While I do have a conference, it doesn't compete with any of these other events -- because winning for me is just giving back as much as I can (and taking NOTHING).
I do these events for my own intellectual curiosity, to help my founders get exposure and to find new founders to invest in.
I wish Paddy the best with his events and I hope the Keiretsu forum folds.
I bit the bullet on Collision, and can't say whether we'll get ROI from #2 or #3 - but I will say they teased and totally f'ed us out of our #1. I still give them credit for being awesome marketers, and love that they give you the quantifiable metrics you need since they published every speaker, investor and media attendee which I've never seen done at any event in the past.
Completely agree with others on Kereitsu - I can't believe they charge startups what they do and have done so for so long. It's really sad not just for startups, but for the novice investors who believe they need Kereitsu for dealflow/co-investments. Really hope platforms like Angelist and new ones following RegA implementation (May 25th!) will change this.
Calacanis's Launch cost $450 a table for 3 days with discount code. For those who attend this year or last how did you feel about it?
These are just scams, avoid them completely. One product/project launch vote on HN will get you more in terms of actual attention from the right people than one of these events.
Let's turn this around: Who active on HN found investment through an event like this? (Maybe this should be a poll?)
Actually, a better way to describe them might be "hobby investors": moderately wealthy people who are thinking about putting this year's vacation money into a startup instead. In exchange for something meaningless like 20k€, they'll want to meddle in the company's strategy and expect regular reports. It's fun -- like playing "The Startup Sims" with real people!
If the hobby investor is well-connected, that can actually be useful. But in the typical case they're probably not the kind of investor that any startup would want, given the choice.
Now, both have come from the pitch events. From my point of view and as a founder, that's the only real reason to attend.
The stands have been almost useless and most of the 'meet-the-investors' events even more so (I do remember one of those where no investors showed up, none, just 50 or so hopeful startups).
That sounds like a 'let's see some refunds' situation to me.
The fact that you are asking this means this post was a very good example of sponsored content. He makes a legitimate point, then spends the second half of the article advertising his own stuff. Classic negative review tactics - bash your competition and then pitch yourself.
As for these conferences in general, I don't understand why it is so hard for these organizers to get investors to come to their events. With the frothy market, investors aren't exactly hiding from opportunities to find new startups worth investing in. The organizers just aren't trying.
It's easy to sell out when you have 60,000 emails and you give every founder a free ticket. :-)
Also, I didn't start this whole discussion, I was reacting to folks who were bashing these other events. Those founders felt duped, not me.
Calacanis states in the article:
"At the LAUNCH Festival this year we gave 11,000 of the 12,000 attendees FREE TICKETS. We also gave away 175 of the 225 demo pit tables for free. We sell some at cost as well ($1-3k).
Our model is to charge the companies who have money, and give them some time on stage to be a judge or do a little content about their product."
I mean, if you're selling a SaaS product that has an average LTV of $5,000 it's probably good idea to spend 2-5x that on a sponsorship for our events (or someone else's) because, well, you'll make it back!
The issue we are talking about here is people "applying" to be in a competition to "get exposure to angels," and then being "accepted" for a fee. That's just lame.
I'm a lucky bastard in that I have the chip stack to take on the risk of a $1m+ budget event, get the support of the top sponsors in the industry and be able to give everyone free tickets and tables.
Remember, Mike and I fought to kill the DEMO conference ($20k to present!) and then he sold to AOL and they decided to maximize profit. I decided to minimize profit -- in fact, my goal is to net out to ZERO each year and give back MORE AND MORE.
Why?
I believe the angel investor who gives away the most value gets into the best deals.
The SCALE conference is going to be free for 2,500 of 3,000 seats. http://calacanis.com/2015/04/29/welcome-to-scale/
We let anyone buy tables through the front door -- no application or anything. We have a ton of bigcompanies and profitable SaaS companies who want to reach the 12,000 folks who come to LAUNCH Festival and the 3,000 coming to LAUNCH Scale in the fall.
This is what Calacanis wanted to say but ended up resorting to the "scam" word. He claims he's the latter and WebSummit is the former.
The comparison to the government's warnings for the modeling industry is not a good one. The government warning is about bait-and-switch, where you go in for a modeling interview but instead it's a sales pitch for products. The conference thing doesn't sound like a bait-and-switch, but rather just a bad deal.
I posted this, despite it being a pitch for Jason, he's street-wise and puts his $$$ where his mouth is... integrity.
I remember going through this ordeal (of taking a decision) a couple of weeks back with Collision Conference. They'd shortlisted us for the conference at Las Vegas and wanted us to pay a sum to attend it.
Here's what I'd tweeted then, at the time:
https://twitter.com/marvindanig/status/579039796238139392
After reading this post I feel happy that we decided not to attend the event. Apparently, it saved us some embarrassment and precious dollars!
https://collisionconf.com/speakers
I guess their kind of thing is suitable for enterprise startups. Where, you know, BS is a way of life and cash is in plenty.
Really, though... bad experience on the startup side != bad conference in general.
The article isn't particularly about the conference, but what it does mention I wouldn't consider too complimentary.
It is clear they don't have the entrepreneur's interests at heart.
Me: Is this REALLY free or I'll need to buy tickets if chosen?
Collision: The stand is free for chosen startups.
We applied and got invited and then we were asked to pay, but declined.
$2000 is not very much money for 2 to 3 people to attend and have a booth at if the audience and attendees are in line with what was advertised. I do agree with an earlier comment that you probably want it to be the case that startups are potential customers for you so that you have multiple ways to get an ROI. (Investors, potential customers and future employees etc)