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Why doesn't Mark Suster attend Y Combinator demo days?

Great question. Actually, I don't attend any Demo Days. I don't believe in Demo Days. I think they are a showcase of who is the best at on-stage presentations and who is the best coached & polished. It's why at Launchpad LA we don't do Demo Days.

I prefer to come before the Demo Day. I prefer 1-on-1 interaction. I like to get to know the companies, their issues, their struggles, their plans. Demo Day doesn't tell you any of that.

I'm not saying Demo Days have zero value. They teach companies to present their ideas cogently and in front of a crowd. But mostly they produce too much hype, too little value.

I should add then when I do attend events like TechCrunch Disrupt it's normally when I'm invited to speak or (gulp) sit on a panel. And I spend most of my time in the corridors talking with entrepreneurs & investors. My ADD is too strong to sit through a bunch of pitches.

Thanks for asking.

Because Mark invests in lines, not dots. Demo days are the ultimate dot.

People invest in people.  It doesn't matter if the investor is doing it on their own behalf, a.k.a angel, or if they are doing it as fiduciary for someone else’s money, a.k.a. VC.  I had lunch yesterday with the guy who runs the acquisitions group for a large publicly traded company.  He only buys businesses from people he likes.

Understand what Accelerators are good and not good at.  Accelerators are great for helping companies develop their product, refine their key messaging, and get started with marketing.  They are not great for getting good ideas coupled with good people funded.  Google tells us that an online purchaser consumes over 10 pieces of information about a product before buying.  Why would an investor consume anything less, or require any fewer touches?  They need to have at least that much info and a well-polished demo only counts for one touch.  Entrepreneurs need to demonstrate that they are thought leaders, have the drive to see the business succeed, make it easy for investors to do their diligence and relate to the investor.  That takes time to develop.

Its forever(ish).  As important, if not more important for the Entrepreneur, is this who you want as a partner?  Just because someone is willing to write you a check doesn't mean you want them as a partner.  It will be nearly impossible to remove them from your company if you choose the wrong investor.  Does one meeting allow a management team to determine if this is who they want to be in bed with until there is a liquidity event?

I agree with Mark - Demo Days have become highly produced presentation - with music and even glitter dressed dancers.   More importantly, the best deals are normally oversubscribed by the time they hit the stage.  I however do attend to support my friends that run the accelerators and to support te community as a whole

An impressive an answer as one might hear from a VC especially for those of us who do believe that something like stage fright can get us killed.

The stronger companies often go into Demo Days with some money already committed.  If you are an angel or a VC with good cred and connections, you can make investment decisions on these startups before they ever get up on stage.  Mark doesn't need to go to these events for deal flow nor do plenty of other investors.  That many choose to do it is a lot more about networking, the joy of being part of the energy and excitement, to back current interests and investments, and as a show of support and alliance with particularly strong programs.