> Troy sent over a Letter of Intent and explained that it needed to be signed and returned by Monday. I was very frustrated by this. You don’t send a legal document to someone over the weekend when their is no time for a lawyer to review it and demand it back by that same Monday. Whether it was the intention or not, this was a high pressure sales technique and just one more red flag.
I was a founder of a company in the TS Chicago class this summer.
I can tell you that this letter of intent was one and a half pages long, contained a simple, bulleted list of documents required for due diligence, and explained the structure of the funding and program.
Additionally, there is a very clear line that indicates that they are willing to extend the deadline provided you give a reason.
Finally, this document is not the formal acceptance of anything related to the program.
I would suggest that "demand[ing] it back" using "high pressure sales techniques" is a strong overstatement.
Ok, sure, fine, it was not technically demanding for a half sober lawyer to go over. Still why not on a Monday then, why not a 2 week horizon? Why do I have to give a reason, why do I have to skip dinner with my wife on Saturday, a plan I have had all week? If it's not formal, then why send it at all? Why send a 4th grade Valentine's day card? Etc.
Basically, it sent a message, at least to these guys. I think they read it correctly.
The challenge in equating our two experiences is the perspective from which the LOI was received. For them, it was a message in the form of another low blow from this high pressure accelerator trying to wrest away 50% of their business. With that mindset, a week probably would have been too short. Who knows.
Ours, on the other hand was, "Awesome! Troy called and invited us to the program! We finally get to quit our day jobs and go after this business full time like we have always dreamed about, and TS is facilitating that! Let's go over this LOI, which is simple and straightforward and doesn't legally bind us to do anything other than say we understand we are continuing the process and wont tell anyone publicly about it and gets us one step closer to Chicago and the success of our business!"
Looking through an LOI and getting it back to them was a joy for us, not a burden.
Without specifically being in the situation, it's hard to tell. The author implied that when they had spoken on the phone, he indicated to Troy that he wasn't sure if he was ready to commit, and then received the "please return by Monday" email within moments. It seems yours was more of a "yes, we're interested" followed shortly by the email. Maybe it's just their standard practice to immediately follow up "the call" with "the email," but I can see how it could be perceived differently depending on the receiver.
I got a similar experience from a different accelerator (which we didn't go to for approximately the same reasons).
What I think happens is that the people sending this are not completely aware of how their role has shifted. They primary see themselves as "startup helpers" while the legal documents makes them look like an investment fund. I'd say they should pick one and stick with it - I don't mind either, but you can't pretend you're investing, and manage paperwork like a naive non profit...at least that tend to rub some people the wrong way.
Maybe, but the good ol razor tells me it could be a simpler case of either: self-absorption (blessed with our acceptance, they'll drool as they jump on signing it), or just formal carelessness - we need these docs back pronto so that's all we care about.
I honestly don't know which is more damning, your sympathetic interpretation--implying "self-absorption" and "formal carelessness"--or mine--implying scumbag cynicism. The reason for my vitriol is my own experience with this kind of "offer". From many people I've talked to this is a calculated technique, and in my opinion expresses a deep disrespect for the recipients. If you are thinking about signing a contract of any import, your lawyer needs to look at it. You can be sure theirs did.
You're talking about the 'skepticism of sincerity' sense of cynicism on the receiving agents' (OP) side. I'm talking about the 'disregard for accepted or appropriate standards' sense of cynicism on the offering agents' (TS) side.
Not that I have any affiliation, though was curious. So I reached out to Troy on Twitter. He claims he extends more time if needed/requested, and they move quickly to close deals.
Is it possible, that maybe what transpired here, wasn't in fact a calculated tactic, designed to screw the applicant?
Extending the deadline is exactly what we would expect if it was a high pressure sales tactic without a legal purpose. Sending legal documents without giving the time for legal review is horrible. You should not be encouraging your startups to skip consulting lawyers.
Well, we both agree that high pressure tactics are not cool. Also encouraging startups to skip consulting with lawyers would be uncalled for. However on the second point, I can't see any mention of that. Do you have any evidence, or is this speculation?
In this specific case, I can see it going both ways.
So I guess where we perhaps differ, is that I would prefer to be certain of intent. Ideally, before reaching for the pitchforks to publicly shame someone.
This says it all to me.