What I Learned from Being Rejected by Investors 500+ Times

Shared Journey with iFly.vc

Mar 12, 2025

Venture capital is a business of no’s—whether it’s me turning down founders or being rejected by LPs. When raising for iFly.vc, I was rejected by over 500 potential LPs—at some point, I stopped counting.

Social media, especially LinkedIn, is filled with celebratory posts: “Company XYZ just closed an oversubscribed $5 million round!” Wins are great, but let’s be real—fundraising is a beast. Most people don’t enjoy it.

In this newsletter, I want to share what I’ve learned from rejection, how it shaped my approach to investing, and a few personal stories—including one that led to billions in enterprise value.

Managing the Emotional Rollercoaster

Fundraising rejection is like a gym membership—you pay in sweat and pain, and no matter how hard you try, someone’s always reminding you that you’re not there yet. It stings, bruises the ego, and, perhaps even worse, when you see a competitor effortlessly raise money from the same investor who turned you down, it feels like watching your high school crush dance with someone else.

I remember a founder who sent angry emails to every investor who rejected him, plus even those who simply made introductions. His company later became a unicorn, but I always wondered: could he have been even more successful with a different attitude? (Recently, I saw his company charged by the SEC for overstating revenue by hundreds of millions. Makes me think even more.)

In my early fundraising days, I experienced my share of highs and lows—especially in 2016, that brutal first year. My coping mechanism? Celebrate the wins. And when rejection hit, I still “treated” myself—just with food court meals, reminding myself, If I’m falling short on fundraising, I’d better start cutting my budget now.

It’s easy to take rejection personally, it shouldn’t. When an LP told me my Asian American identity didn’t qualify my fund for her DEI Emerging Manager Program, I called it out for what it was—absurd and racist. I refuse to let my ethnicity be a reason for disqualification in any circumstance.

Rejection stings. It’s okay to feel it. But dwelling on it won’t change the outcome. What matters is how you bounce back. Resilience, self-care, and perspective aren’t just helpful in fundraising—they’re essential for long-term success.

And the next time you feel bad about investor rejection? Just think of your friend Han Shen—who racked up 500+ rejections and is still going. :)

Rejection is About Fit, Not Failure

A no isn’t always about you. Sometimes, it’s investor bias, risk appetite, or bad timing. If you truly believe in your vision, don’t let rejection shake your conviction.

Just like Product-Market Fit, there’s Startup-VC Fit and GP-LP Fit. Investors have different strategies, focus areas, and risk tolerances. Some VCs aren’t comfortable with certain sectors. Some LPs won’t back solo GPs—so I know I’m automatically out for them.

I once had an LP reject me and suggest I “learn from another emerging fund.” My first thought? What? That fund’s GP had a gross IRR lower than my net IRR—what exactly am I supposed to learn? It stung, but in hindsight, it was just a mismatch, and I moved on.

Fit goes both ways. I’ve turned down large checks when terms would have been unfair to other investors. The right partnerships are built on trust and shared conviction. The wrong ones? They cost far more than just capital.

Rejection is Inevitable—So Get to “No” Efficiently

Since no is part of the process, fundraisers should aim to get there as quickly and inexpensively as possible. It’s tempting to answer every question in every meeting, but why not first understand what the investor likes, dislikes, and focuses on? That way, you can steer the conversation and avoid unnecessary deep dives with the wrong prospects.

Tracking progress is just as important as pitching. Always use a CRM—fundraising is a sales process, and it should be treated like one. I use Affinity, but I’m curious—some VC friends are moving to Attio. If you have experience with it, I’d love to hear your thoughts.

Time is your most valuable resource. I’ve learned the hard way that dragging out conversations with the wrong investors wastes energy and slows momentum. Qualify interest early. Move fast. Focus on the right opportunities. Keep pushing forward.

Every “No” is a Chance to Learn

Fundraising is a numbers game—how many meetings, how many pitches, how many investors. But it’s not just brute force. Every rejection is a chance to refine your strategy, improve your pitch, and sharpen execution.

Some investors provide feedback. Some don’t. But a single thoughtful question has often forced me to re-evaluate my pitch or spot gaps in my strategy. Even a bad meeting can be a useful one. Between my first and final close for iFly.vc Fund I, I rewrote my entire pitch deck to better reflect a strategy that aligned with a solo GP-led emerging fund.

Repeated rejection can be a signal to reassess your approach. Are you targeting the wrong audience? Is something unclear in your pitch? The key is to take what’s useful and leave the rest.

Playing the Long Game

As a VC, I try to say no to founders thoughtfully. Whenever possible, I try to do something helpful, such as making introductions to customers or investors.

Looking back, many of the LPs who initially rejected me later became investors. Others introduced me to key connections. Some of those early “no’s” turned into introductions, second chances, and even LP commitments down the road.

Fundraising isn’t just about capital—it’s about learning, building relationships, and strengthening your conviction. Every no is just a step closer to the right yes.

A Few Stories From My Own Journey

Turning Down Weee!—and Then Betting Big

In 2016, I passed on investing in Weee! I had concerns about their operating model and scalability. The founder, Larry Liu, raised money elsewhere. In 2017, Weee! faced a near-fatal crisis—a moment that could have ended everything.

What followed was an incredible turnaround. Larry pivoted, changed the model, and put Weee! on a new trajectory. By September 2018, we reconnected. Despite my initial rejection, he valued my critical engagement early on. Later that year, I doubled down and became a major shareholder, helping Weee! grow into a category leader valued at $4.1 billion in its most recent round.
A Rejected Founder, A Future LP

In 2015, I turned down a founder in Palo Alto. Instead of just walking away, I introduced him to someone who helped his business. A few years later, that same founder introduced me to a family office—which later became a significant LP in iFly Fund.
The LPs Who Circled Back

Some LPs initially rejected me, skeptical of investing in U.S. consumer innovation. But I kept in touch, updated them, and over time, they saw the value. Some eventually joined the final close of Fund II, which made up almost 15% of the fund size.

The Lessons Learned

A NO today doesn’t mean a NO forever. Keep doors open. Many great partnerships happen on the second or third outreach.

To all the founders and fund managers facing rejection—stay gracious, keep learning, and never lose sight of your mission. The right fit is out there; persistence is key.

And in a sea of NOs, don’t forget to celebrate the small wins. They add up.

Until next time,

Han