Part 12: How to get on calls with investors
Are you ready to go hunting for external capital? Do you have a start-up that is potentially attractive to investors, and do you have all the necessary assets to raise in place (pitch deck, elevator pitch, financial model, data room, investor lead list, etc.)?
If so, you might be wondering how to get on calls with investors. It's a common struggle for many founders given that there are more start-ups than funds. Here are some ideas to help you out:
Your network: Ideally, you will have already started to cultivate investor relationships. If not, start it now. Fundraising is a core skill set for founders, and your network is part of this.
Network of your friends: Check out your friends' network on LinkedIn and ask them for intros to investors that are relevant to you. LinkedIn lets you go through the network of your connections unless your connections disabled this feature. Do the work for your connections and don’t ask for intros to irrelevant investors. Be selective. Limit your ask.
Network of other founders: Connect with founders of portfolio companies of investors that you think maybe a fit for you and show them that you are a good company to introduce to their investors. Many founders like to help other founders but, if in doubt, they will prioritize their own reputation over the success of your start-up.
Participate in pitch competitions and start-up conferences. Be targeted in where you go, though. Contests can be a waste of time. Focus on real impact instead of vanity metrics. Same for incubators and accelerators, by the way.
Matchmakers, like our partner Funden. They will send intro requests to their networks of partner funds if you fit the criteria of their partners.
Cold outreach via email, social media like LinkedIn and Twitter, and application forms on the websites of investors. Just note that warm beats cold. In sales, cold response rates are below 1-2.5%. It'll be the same for your cold investor outreach, meaning you need high volume (in addition to writing quality outreach messages).
Incubators, accelerators (but beware, they can be a time sink if the brand is not well-known).
Creative hacks, like advertising on social media, searching for angel investors on AngelList, listing on an online investor platform (including angel clubs), or getting media coverage (this is going to be difficult for early-stage start-ups).
Depending on your success with the list above, you may also want to consider alternative sources of funding, such as F&F, grants, crowdfunding (both equity platforms and pre-sales platforms, such as Kickstarter), revenue-based funding (such as Pipe and Capchase), start-up loans, and other options.
One last piece of advice: don't waste time completing customized funding applications forever unless there’s massive upside for you. For some reason, some sources of funding think it's okay to ask founders for endless application forms. It's always better to build your business if you have the runway to keep growing.
Talk soon
Rafael
PS: How do we help you? My team and I build pitch decks, review existing decks, and offer pitch simulations. Get in touch if you or someone you know may be interested.
PPS: This mini course is based on our popular “Fundraising & Pitch Deck” newsletter.