If your goal is to build a world-changing product (or to create one of those unicorns everyone is talking about), at some point you’re probably going to need the help and resources of outside investors. But pitching investors can be a painful process.
We investors are fickle – we might respond to your email in 30 seconds or 30 days, depending on how you came onto our radars. We can get a thousand emails, only respond to 100, take meetings with just 10 companies, and invest in only one.
So how do you make sure your startup is one of the few companies that pique our interest? What can you do to capture the attention of top-tier investors?
To address this problem, I’ve compiled a list of things you should and should not do in order to get the attention of investors. This list is based on my psychological research in attention, my personal experience as an investor, and the experience of other great venture capitalists and angels.
Here are a few tips if you’re looking to get on the radar of investors:
What To Do
Establish your credibility up front. Journalists are taught to never bury the lede; smart entrepreneurs follow the same advice. Investor time and attention is limited, so lead your emails and sit-down meetings with the best aspects of your pitch. This gives you the best shot of getting an investment.
“Tell me the sexy stuff up front,” says Boost VC founder Adam Draper. “Do you have an all-star team? Do you have traction that makes a hockey stick? Did you cure cancer? Get the attention of the investor early, and you should be able to keep it for the rest of the meeting.”
Get an introduction through someone trustworthy. You’ve probably heard this one before, but there’s a reason this is the golden rule for approaching investors. The best investors simply have way more inbound emails and pitches than they know what to do with. Because their attention is so scarce, they build filters to protect their time and attention.
One key filter investors use is their network of trusted friends and experts. If a person has already vetted the entrepreneur and/or the idea, it’s much more likely to result in a quality meeting.
“Always, always always get an intro through a trusted source,” says Jon Soberg, co-founder and managing partner of Expansive Ventures. “Never ever send a cold email or LinkedIn request.”
Show you can sell. Josh Felser of Freestyle VC has a simple piece of advice: “Send me a personalized, thoughtful request to connect that shows that you understand how sales actually works.”
I receive hundreds of impersonal pitches daily. Some entrepreneurs send mass e-mails; others clearly haven’t done their research on my firm; I even get some entrepreneurs who address my firm or me by the wrong names.
The problem is that great entrepreneurs have to be great at sales. You’re going to have to sell a product to users, customers or advertisers at some point. If you can’t show us that you can sell, it’s a major red flag that will threaten the future of your company. Put in some real effort.
What Not To Do
Don’t go after the best-known partner of a fund. The big-name partners of a VC firm – you know, the ones with their last names in the firm’s name – are the ones who are pitched the most. They also have the least amount of time, due to their countless commitments and existing investments. It’s harder to get the attention of these investors.
“Seek out the up-and-coming partner or the one who isn’t in the limelight as much,” says Christine Tsai of 500 Startups.
Stop going after the famous investor of each firm and talk to the other partners of a venture capital firm. In the same vein, don’t ignore principals, associates and assistants in favor of partners. It’s rude, inconsiderate and short-sighted. That’s the kind of behavior that always gets discussed at weekly investment meetings.
Don’t insult your competition. When an entrepreneur trash talks successful tech giants like Uber, Facebook or Airbnb, my attention immediately turns off. Entrepreneurs should have a healthy respect for their competition.
“Facebook and Google are Facebook and Google for a reason,” Adam Draper adds. “It only shows that you don’t know your market as well as you think you do.”
Don’t send a long-winded email. Novice entrepreneurs love to send 10-paragraph emails explaining every aspect of their startups. But what sane investor has the time to read 10, 100 or 500 multi-paragraph emails every day? Unfortunately, investors don’t have enough time to read all the emails that come to them, so help us by keeping your first email short and sweet.
Lead with you and your team, the core of the idea, why you think the investor you’re pitching is a fit, and ask him or her whether he or she is interested in learning more. Sending a pitch deck is great – if the email intrigues the investor, then he or she will dig deeper. If it doesn’t excite them, then you’ve saved yourself hours and hours of time that can be spent pitching other investors.