Structure
Genuine compliment (1 line). Specific to them. Not generic praise.
The reason (1-2 sentences). Why it's not a fit for your fund. Honest, not vague.
Optional: Useful pointer. Another VC, an advisor, a customer. Only if you mean it.
Closing. Door open for future rounds.
Example
Hi Jenna,
Your traction in the first 6 months is impressive — the LTV/CAC math actually works, which is rare at this stage.
For our fund, we're focused on infra-layer companies this year, and you're more application-layer. Not a thesis fit, not a quality concern.
You should talk to Sarah at Foundry — she's been doing application-AI deals all year and would get this immediately. I'll intro if you want.
Stay in touch on the Series A. Likely much closer to fit then.
— [VC name]
Why it works
Specific compliment proves you read carefully. Honest reason removes the founder's anxiety about what they did wrong. Useful pointer turns the pass into a value-add. Door open for future rounds keeps the relationship intact.
Let Pranan adapt this to your voice
The template is a structure. Pranan fills it with your sentence rhythm, vocabulary, and tone for the specific recipient.