Okay, so you’ve created a comprehensive list of investors you want to talk to. Now how the hell do you meet them?
A vanishingly small number of investors will look at any pitch — GoAhead ventures is one such firm. For most VCs, though, you’ll need to get your foot in the door to be heard.
Many investors prefer, and insist on, warm introductions. LinkedIn can be a powerful tool for doing research here: Check out your target firm’s LinkedIn page, then click on “People.” Here, you will see your first-degree and second-degree connections with everyone in the firm. If you happen to have a first-degree connection, that could mean they’ve met you and would remember you, or you’ve somehow caught their attention and now have a potential to reach them via a message, post or email. If not, it’s time to mine those second-degree connections.
A second-degree connection is when you and the investor you want to talk to have someone in common. If that person is in one of the company’s portfolio companies, you’ve hit pay dirt: Investors tend to prefer introductions from people they’ve already backed once. If you pause and think about that for more than 20 seconds, you’ll realize that’s problematic, but we’re here to get you in front of an investor not solve that particular problem.
In the rest of this article, we’ll discuss the art of the warm intro, and how to take matters into your own hands with cold outreach if you have to.
How to set up a warm introduction
Once you’ve identified who can introduce you, make it as easy as possible for them to do just that. Reach out to your mutual acquaintance and ask how strong their connection is with the investor. At this point, it is not a bad idea to ask if there are other investors you should be talking to.
Engage this person and ask them politely if they could introduce you to the investor you’re targeting or someone else who could be suitable. Once this person agrees to introduce you, give them the following information:
- The fact that you’re raising money for a company.
- The name and URL of the company.
- A one-sentence summary of what the company does. “We are making it easier for influencers to create their own brands” works for Supliful. “We are making diamonds a tradable commodity like gold and silver” works for Diamond Standard. You get the gist: Brevity and a rough idea are all you need here.
- A paragraph summarizing why what you’re doing is interesting, or what you have discovered that nobody else has. “We’ve grown 20% every week for six weeks straight,” is great if you have good traction and growth. “We have patents, meaning that we are the only solution that can use this technology,” is another strong one. Stand out and make it good.
- Finally, a quick summary of the ask: “We are raising a $3 million pre-seed round to expand from 10 to 150 customers,” does the trick.
All of the above should fit in two to three paragraphs at most. Forward it to the mutual acquaintance and let them know that they can either use it as is or edit it to their liking.
Some people will want to see and forward your pitch deck (if they do, make sure you share a send-ahead deck), but even if they don’t, it’s common for investors to ask for your deck before they agree to a meeting, so be ready for that.
Once you’ve been introduced, give it a couple of days. If the investor doesn’t get back to you, reply on the email thread asking if they’re interested in talking further. Hopefully, they’ll take you up on it.
Cold outreach
There’s something a lot of investors won’t tell you about cold outreach: Many VCs, especially those who aren’t in the blue-chip echelon of investors, suffer from permanent fear of missing out (FOMO). Nobody wants to risk missing a potentially hot deal, so they’re always on the lookout for outliers, exceptions and the kind of founder who falls into the “too weird to live, too rare to die” category.
If you have an investor in mind, follow them on social media, subscribe to their newsletters and keep an eye on their output. If they run events, go to them. If they are speaking at, say, TechCrunch Disrupt, go seek them out in person. Introduce yourself, have your elevator pitch ready and do what persistent salespeople do: Find a way to start a conversation. That doesn’t mean you should be rude or refuse to accept “no” for an answer, but it does mean that you should get creative.
If all else fails, cold outreach via email, Twitter or other social media channels may work, depending on the investor. You may not be able to charm your way into a meeting with one of the partners at the firm, but associates and other junior investment staff are always out there trying to scout the next hot deal. Some firms have specific scouting programs or they may work with angel investors to do scouting for them. Do your research, ask other people in the ecosystem and figure out how to get an email to them.
Once you have an email address, the process is very similar to the “warm intro” approach above.
“I met you at TechCrunch Disrupt,” or “[your scout] gave me your email address,” or “I loved that you invested in A, B and C. I’m building something in an adjacent space, and I would love to tell you more,” are all great openers that will invite people to keep reading. Follow up with a short summary, the unique points about your company and your pitch deck — and hope that your startup overlaps with the investor’s thesis enough that you get invited to run through your pitch properly.
This is the first of a series of three articles focusing on finding investors for your startup:
- How to find your investors.
- How to get warm introductions and leverage cold introductions (this article).
- How to run your investment outreach process (coming soon!).