ITR #006: Preparing for Thorny Investor Q&A

Plus, how I wrangled a special guest for a live session this Friday.

Author

Jorian Hoover
January 08, 2025

Happy New Year from Into the Ring!

I just returned to my desk after a joyous holiday season, and feel refreshed to kick off 2025 in style. I hope you too had a great holiday, time to recharge, and are ready to rock ‘n roll in the New Year.

One of my goals for 2025 is to deliver more high-quality education & insights for founders looking to fundraise. Into the Ring is the perfect vehicle for that, and I’m excited to share more valuable content with you this year.

“How to Fundraise without LARPing” live session this Friday

I did it, y’all. I wrangled Rob Snyder to talk about fundraising. Rob is an expert at startup sales - and has helped dozens of companies hit their first $1M in ARR. Earlier this year, Rob went viral - achieving 30K followers on LinkedIn practically overnight from sharing his entire 6-hour, 91-slide workshop for Harvard Innovation Labs.

LARPing stands for Live Action Role-Playing, and it’s a term Rob & I use to describe startups who aren’t really selling! This often shows up in my world through bland Go To Market slides and an inability to answer prodding questions about sales from investors.

Rob & I will talk through how to build a startup sales strategy that actually works and that will impress VCs. Oh and Rob has some pretty hot takes on VCs, so I recommend bringing your popcorn.

If you want to join us this Friday Jan 10th at 12pm Eastern, you can secure your free spot here (we already have 50 signups!): https://lu.ma/zud8lhsk 

…now on to today’s essay around thorny investor Q&A.

Preparing for Thorny Investor Q&A: A Founder’s Playbook

Picture this: you’re in a pitch meeting with a promising venture capital firm. You’ve delivered a flawless presentation. Then it happens—a question that cuts to the core of your business or highlights a potential weakness. Suddenly, your momentum stalls. The investor leans back, observing how you respond. How you handle this moment can define the trajectory of your fundraising round.

Welcome to the world of thorny investor Q&A.

These are the questions that throw founders off—questions that probe weaknesses in your business, challenge your market knowledge, or require detailed answers that don’t roll off the tongue. It’s okay not to have every answer on the spot; following up with thoughtful responses post-meeting is perfectly acceptable. But too often, founders either fumble through an answer, leaving a poor impression, or freeze entirely, signaling a lack of preparation or leadership.

Let’s discuss why preparing for thorny questions is critical, how to create a system for tackling them, and how to ensure you shine even when the heat is on.

Why Thorny Questions Matter

Thorny questions test more than your knowledge; they test your composure, strategic thinking, and leadership. Investors know every startup has weaknesses. What they’re evaluating is how you navigate these weaknesses. A strong response to a tough question can not only alleviate concerns but also demonstrate your ability to handle high-pressure situations—a critical skill for any founder.

The Framework: Four Steps to Mastering Thorny Q&A

Step 1: Identify the Questions

Start by making a comprehensive list of potential thorny questions. These can come from multiple sources:

  • Your Pitch Deck: Go slide by slide and ask yourself, “What questions do I not want to be asked here?” For example:

    • Market: “How big can this company really get? This feels like a small market.”

    • Competition: “What if Google/OpenAI/Salesforce enters this space?”

    • Product: “This feels like a feature, not a whole product. Where do you go from here?”

    • Team: “Why are you the right team for this opportunity?”

  • Your Network: Ask founder and investor friends to help brainstorm tough questions they’ve encountered or believe you might face.

Aim for at least 20–30 questions. Use a simple Google Doc to keep this list organized.

Step 2: Craft Thoughtful Responses

Once you’ve identified the questions, the next step is preparation. For each question, craft a response that is both honest and positions you positively. Some questions may require deeper research to provide compelling answers. Let’s look at two examples:

  • “What if a major competitor moves into this space?”

    • Possible Answer: “Most big tech firms are slow to add new products, and their teams struggle to create a great 0-to-1 product while navigating legacy issues and internal politics. Our focus and agility give us a significant advantage.”

  • “How big can this company really get? This feels like a small market.”

    • Possible Answer: “In the future, we expect the market to expand significantly due to X and Y trends we’ve observed. Here’s why we’re positioned to capitalize on this growth.”

Writing responses is only half the work. The next step is to practice them aloud. It’s essential to hear how your answers sound and refine your delivery. This practice helps you internalize the responses, so they feel natural in the moment.

Step 3: Deliver and Iterate

Once you’re in the pitch room, it’s time to put your preparation to the test. Remember, how you answer is just as important as what you answer with. To maintain composure and confidence, use the acknowledge-respond-pivot approach:

  1. Acknowledge: Show you understand the question and why it’s being asked.

  2. Respond: Provide your thoughtful and prepared answer.

  3. Pivot: If the question is especially thorny, redirect the conversation to a strength or opportunity in your business.

During your fundraising process, refine and add to your Q&A based on real interactions. Did an investor throw a question out of left field? Did one of your answers particularly resonate? Continuously improve as you go.

Step 4: Keep Your Prep Private

A final note: never share your full list of thorny questions and responses with investors. While transparency is important, volunteering every potential concern might inadvertently amplify doubts. Every investor is entitled to their own worries - but don’t give them dozens of new worries!

Bringing It All Together

Handling thorny investor Q&A isn’t about eliminating tough questions; it’s about showing you’re ready for them. With preparation, practice, and a structured approach, you can turn moments of vulnerability into opportunities to demonstrate your leadership and vision. I’d love to hear from you: What thorny questions have tripped you up in the past? How did you handle them? Let’s keep the conversation going.

👉 Need help getting game ready for thorny investor Q&A? I would love to help.

Every other week, I’ll be reaching out to my network to get their take on important questions on every aspect of fundraising. Got a question you’d like me to ask? Let me know.

Q: What was the hardest question you were asked by an investor, and how did you respond?

“The hardest questions are often those you can't answer confidently. As a founder, your job is to help investors envision the future based on a solid foundation, even when many elements remain invisible. It's crucial to be confident in your vision while also being open about what you don't know.”

- Pre-Seed Founder, $4M+ raised, US.

“The hardest question I often encounter is about our exit plan for the business. As a founder, my focus has been on building the business rather than defining a specific exit strategy. However, I recognize the importance of having a clear vision for potential exit scenarios, even if it's broad.”

- Seed Founder, $8M+ raised, US.

“The hardest question we faced was, "Why do you need over $25 million?" This was particularly challenging as it was our first round, and articulating a large number without having everything fully flushed out was difficult. We responded by clarifying that we only needed a fraction of that amount, directly addressing the underlying question of why we required such a significant sum.”

- Series A Founder, $30M+ raised, US.

“One of the hardest questions we faced was when an investor asked us to explain "the geometry of our business." It sounded complex, but we knew they were really asking about the business model and growth plan. The key is to break down the question and respond in clear, simple terms, even if the question itself is vague.”

- Series B Founder, $35M+ raised, US.

“One of the toughest questions we faced was about our exit plan and how big our company could become. Investors often seek the dream of billion-dollar exits and unicorns, but we initially focused on building a solid business. We were realistic and humble, knowing that achieving even a fraction of that would still be impressive. A key learning was understanding that an investment process is like a sales process, where humility might not always be the best approach.”

-Series C Founder, $50M+ raised, EU.

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