We ran into this mindset in early meetings with some VCs once-upon-a-before-we-decided-to-bootstrap. We had some market validation, and didn't forsee needing much money to go from our humble launch to national presence (at the time we would have struggled to spend even $150k).
But by asking for a low figure, it seemed to signal that we didn't see ourselves as the next $100 million business (the horror!). As an experiment, we doubled the number in subsequent discussions and got a far more positive response. In the end we decided that getting early investment wasn't for us.
I completely appreciate where the more skeptical VCs were coming from, though. If you're going to spend the same amount of your time working with a group of people long-term, you might as well put that time into a company that is eventually worth billions instead of millions.
There's actually raw mechanical economics feeding into this: it turns out to be hard for VCs to find good places to put money at risk, and also a giant pain to be on lots of boards. Invest/dont-invest can sometimes be more or less binary, and if true, desired-amount=maximum.
But by asking for a low figure, it seemed to signal that we didn't see ourselves as the next $100 million business (the horror!). As an experiment, we doubled the number in subsequent discussions and got a far more positive response. In the end we decided that getting early investment wasn't for us.
I completely appreciate where the more skeptical VCs were coming from, though. If you're going to spend the same amount of your time working with a group of people long-term, you might as well put that time into a company that is eventually worth billions instead of millions.