200 Rejections to a Billion-Dollar Exit: Larry Cheng on Resilience
episodePreviously titled “200 Rejections to a Billion-Dollar Exit: Larry Cheng on Resilience and Growth” — renamed by the publisher on Aug 4, 2026
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My philosophy is you try and turn the long maybes into a quick no. That saves you time. Every firm has a fit. It's the type of deal that's in their comfort zone. You want to assess whether you're a good fit. You could spend two months and it's not a good fit at the end. So I try and make it easy for people to turn me down. We might not be the right stage. We might not be the right sector. Maybe we don't have enough proof points. Let me tell you all the reasons you can turn me down. I will not take it personally. Try and encourage the no, and that will save you time because...
How did Larry Cheng overcome 200 rejections in fundraising?
The place that I wanted to start with you is actually a tweet that I found from a few weeks ago. It's just something that intrigued me and I was wondering where it came from. You said, just a thought this morning, a personal philosophy applicable to selling, fundraising, et cetera. Don't take no's personally. Don't take yeses for granted. I love just, I think you're dialed on that. And just interesting where that came from and kind of how that applies to both the businesses you run and the businesses inside your portfolio.
Yeah, so let's go there. When we started Volition Capital, we're a private equity firm specifically focused on growth, and we had to raise a fund. And a fund is made up of different investors, very institutional, like university endowments, big charitable foundations, wealthy family offices, and so forth. And when we first started this firm in 2010, it was two years post-financial crisis. No one wanted to invest in a new emerging firm. They wanted to even cut their allocations to this asset class and only stick with the firms that they knew. And I put my head down. I talked to 200 different investors, and they didn't even say no to me. Most of them ghosted me. And in my world, the investors are called limited partners, LPs.
And the reason they ghost you is because they want to see if you can raise your fund to get close to your target, and then they can come in at the finish line. And I didn't take any of those turndowns or ghostings personally, because honestly, I understood. We are a new firm. There are reasons to not invest with us. It's a long-term commitment. It's like a marriage. And I didn't take it personally. And somewhere in like 200 to 210, someone actually committed. And that started the ball rolling. And we got a few more investors. And we ultimately raised our first fund. And our first investment out of that fund was Chewy, which became the leading pet food e-commerce business, which I'm sure we'll talk about, a multi-billion dollar exit.
And we've been off to the races the last 15 years. And so now we're sitting here where we are 15 years later. I still don't take turndowns personally because there are going to be times when certain investors, they can't invest or it's not the right fit, and that's a-okay. And we certainly don't take for granted any investor who wants to invest in us because we know how hard it is the first time. And so you always treat your LPs, your investors well. You care about what their needs are. You're transparent with them and all that good stuff. And so that's always been my philosophy. I thought it applied even just to selling in anything. It seems like a healthy philosophy to go after it with.
Yeah, I completely agree. So 200 meetings before you got your first yes. I mean, even if you logically have this, you know, don't take no's personally, like I might say detach from the outcome, you know, whatever, whatever way you phrase it, right? like even though logically we can sit here and go, yeah, detached from the outcome to tech, like, you know, you get banged over the head 200 times or ghosted, you know, there's a little bit like, how do you, I think a lot of people would give up before, before they would hit 200 meetings, you know, without a, without a yes, like there had to be moments in there where maybe you were questioning your investment thesis or who you were going after.
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