Use LinkedIn to raise a Series A

With investment activity reaching a three-year low in Q2 of 2023, it’s clear that we’re deep in the midst of a funding winter.

However, founders with their Series A on the horizon are facing especially tough odds. Seed startups in the U.S. were least affected by the funding downturn as investors opted for smaller deals against more costly late-stage rounds. While this was good news in the short-term for new startups, there are now more seed-stage companies than ever in the pipeline and the average funding time between seed and Series A has stretched to 25 months.

Having a stellar pitch deck will encourage investors to bet on your idea, but how can you convince anyone without first securing a meeting?

In 2023, founders will need to actively court the attention of investors to get their foot in the door. LinkedIn provides an extremely valuable resource here. With more than 950 million professional members worldwide, the platform offers a vast database that can be used to research potential investors, build new connections and nurture these relationships with a methodical process that will directly set the stage long before it’s time to raise your Series A.

Here we’ll break down a strategic four-step approach that will help to boost your reach and visibility with investor networks on LinkedIn.

Grow your network of investors

While it’s likely you already have several investors in your network, the first stage of the process will focus on increasing this pool significantly. A study exploring the success of job hunters on LinkedIn found that networking with weak ties (a larger set of people you know less well) resulted in more jobs than strong ties. For founders preparing to fundraise, the same science holds.

As with any lead generation process, the ability to track progress and measure results is going to be central to this strategy. This means the first order of business is to compile a comprehensive database of potential investors.

Take your time with research here. With LinkedIn, you have access to an immense directory, therefore uncovering a wide range of investors who are relevant to your startup won’t be achieved on the first couple of search returns. Starting with the most obvious keywords such as “investor” + “industry” is a logical starting point but you’ll want to get creative with your search queries beyond this. For example, many investors look to support founders from a specific background or fund startups that align with a certain impact cause, but finding these kinds of synergies will require you to cast your net wider by using the advanced search function.

Log any promising investor profiles in your database as you proceed. Be sure to include a range of fields such as personal details, prior investment activity, industries and subjects of interest and any mutual connections you hold, as this will form the basis for later stages of the engagement strategy.

With this process, we’re playing the long game. Asking for a favor upfront is just bad manners, so this initial message should never include a pitch or request for funding. Instead, you’ll want to use your research database to tailor a short, personalized opener that leans into their interests or highlights any common ground you share. For example, perhaps you studied at the same college or both happened to attend the same conference last year. Investors heavily rely on referrals when sourcing deals, so be sure to highlight any second- or third-degree connections where possible to add further credibility to your introduction.

Not every request will result in a new connection, but with patience and consistency, your pool of investors will begin to grow. Now it’s time to ensure your name is firmly on their radar.

Add new accolades to boost visibility

While being generally active on LinkedIn is a good rule of thumb, it’s important to know that not all posts are treated equally.

For example, let’s say you’ve recently delivered a workshop at an incubator you’re affiliated with. Sharing a post about this on your general feed is likely to get some traction, but sharing the same news by adding a new accolade to your profile will be prioritized by LinkedIn’s algorithm, automatically gaining more visibility.

In addition, activities like mentoring up-and-coming founders, authoring a guest article for an industry publication or speaking at educational institutions are a powerful way to validate your profile in the eyes of new investors in a way that doesn’t look self-promotional. Although participation will demand an investment of your time, such activities are valuable opportunities that will deliver for the company on many fronts.

To maximize the return on investment, go into edit mode on your profile and list the accolade and associated institution as a new work position, being sure your current position remains as primary. Use a tailored headshot instead of the generic templates and add a caption detailing the opportunity along with some insights into how it benefited your industry and personal growth as a founder.

Make and stick to a regular calendar of company updates

Momentum matters when raising capital. It’s the single most important factor influencing the speed of your fundraising process and the probability of actually getting funded.

This means actively demonstrating the activity of your startup to make sure investors aren’t under the impression that things have gone stale. Develop a strategic posting schedule — with content focus, format, and timing — and execute it consistently, aiming to post at least three times a week.

Good investors want to jump on a moving train, not help to jump-start a car. Arbol, a fintech solution for college students, realized this and adopted a communication approach that showed investors exactly what was going on behind the scenes.

“Social media allows you to tell your company story and have investors track progress in real-time as key events occur,” commented David Gonzalez, co-founder of Arbol. “During the middle of our raise, we used LinkedIn to share that we hit our product launch milestone. This directly led to both angel and institutional investors who were in our pipeline to close,” he concluded.

For other founders, it’s important to focus LinkedIn posts on the kind of information that investors generally want to know when assessing startups. This could include company milestones, your perspective on important industry trends, business partnerships, team achievements and details about your product and its roadmap.

Build reciprocal relationships

The law of reciprocity recognizes that when someone does something for you, you feel inclined to reciprocate and do something in return for them. For instance, having an acquaintance unexpectedly cover the entire tab during lunch will be a welcome surprise. Though returning this favor isn’t obligatory, the kind gesture will stick in the mind and make it more likely that a relationship will develop in time.

Imtiaz Mohammady, CEO and founder of global digital consultancy Nisum, credits the law of reciprocity to much of his company’s success.

“Money comes and goes, but it’s the relationship you build that stays forever. Being an early pioneer of e-commerce meant I experienced the meteoric rise and subsequent fall of many early internet retailers. Time and time again, the fortunes of these companies were inextricably linked to the relationships they had built. This led me to realize how strategically important it is to invest in people using the law of reciprocity,” Mohammady shared.

This approach can be adopted during fundraising to harness powerful results. By this point, your network of investors should be aware of your business and what type of leader you are. Now it’s time to offer the strongest connections a “free lunch” with no strings attached.

In this scenario, we’re talking about publicity. For example, you could author a LinkedIn article related to trends in your industry that highlights some active investors from the field. Here, your investor database will help to quickly identify relevant profiles. In addition, identify any investors in your pool who can be classed as warm leads. Click the bell icon on their profile to sign up for notifications and consistently interact with their content.

Unprompted, organic engagement will act as the final step in turning those weak investor ties into active connections that are primed well in advance of your Series A round.

Investor relationships require an investment of time

Investors are inherently cautious, even more so in 2023. Founders need to play the long game and begin nurturing investor relationships well in advance of their Series A.

Widening the pool of investors and engaging with these invaluable contacts is going to be a key success metric in the years ahead. Whether this is done on LinkedIn or at in-person events, founders need to remember that building positive investor relationships won’t be achieved overnight.

Yet with a clear strategy, a consistent approach and the right tools, every startup can improve their chances of getting the opportunity to pitch to their ideal investors.