We closed our 1st investment round in December for TheVisionaryVC.com 🎉
– We did not use a pitch deck
– We did not do any cold outreach
– We didn’t spend months raising funds. It was pretty quick!
Instead, my business partner Stewart Stanbra and I did the following:
– We did it the old way. We had an 8-page business plan. No deck.
– We only contacted hand-picked investors who were familiar with our work.
– We never pitched when meeting investors. The meetings were meant to get to know each other better and offer the opportunity to build something exciting together.
– Getting cash was not enough. We wanted to bring together complementary expertise and valuable networks.
– We wanted to make sure we all got along. We introduced everyone to each other before they invested and we covered topics such as risks, crisis management, and worst-case scenarios.
– We asked investors already committed to the round to meet and vet potential new investors. We had meetings where potential investors presented to the committed investors why they want to invest and how they can contribute. Turning the tables!
– We had to turn down some investors, in order to maintain a small and manageable group of shareholders. It’s easier to cook with fewer people.
When you cracked the code. Fundraising becomes a simple formality.
Here is what you can achieve Startup-Investor FIT:
- Contact investors who have followed your work for some time.= Build relationships. Get in touch with them before you need them.
- Approach those familiar with the problem you are solving and who are already working within the industry you are targeting. Focus on them.
- Find investors who have the network of clients and partners you need. They will feel more relevant to you and feel that they can support you.
- Prove that you have traction, and get paying customers. Don´t tell, show them the money 🤑.
- Start with your local network. Pitching to investors based abroad is always more complicated. Angels like to meet startups they invested in, work with them and… keep an eye on them.
- Put yourself in a position where YOU don´t need them. THEY need you! How? They should be the cherry on top of the cake. Not the cake. Get clients. Make money. Investors will feel like they might miss on a big opportunity.Investors are getting pickier and pickier when it comes to their investments. They are approached daily by other startups looking for money.
Think about how you can stand out and why they should spend money and time on you and with you.
- The job of a CEO is not just operational, it is also to be the face of the company. Build your personal brand online, be out there, network, and get noticed. It is a long-term game and it is time-consuming. So you better start now.Angel investors will have a look at your social media (personal) profile and evaluate your overall digital presence.
- Don´t just look for money. Investors are looking for more in startups than just investing. They want to help and feel valuable by offering expertise and their network. They want to be proud ambassadors. Make them feel it’s not just their money you are looking for.
- Be clear on what you want to build and how. Don´t pitch different solutions, products, and how your product has great functionalities. Start small, and sell what you have. Show traction and results as soon as possible.
- Most professional investors have an investment thesis. Ask them questions about the kind of companies they are looking for. If you are not a match, don´t prioritize them.
- Get other startups within your network with similar business models or products to introduce you to their investors. Warm intros are the best.
- There are also professionals who can provide you with a list of relevant investors based on your industry, business model, and stage. If you want to talk to some of these service providers, let me know. I can help.
- Finally, when talking to investors, listen more than you talk.
I am often on calls with founders who are trying to “sell me” their investment opportunities or convince me that their product is AWESOME.
What happens? I take a step back. They are desperate and all they are looking for is (my) money. It is not a nice feeling. That´s not what I am looking for.
Nobody wants to marry a desperate, self-centered, needy person… The same is true for investors. An investor doesn’t want to invest in a desperate entrepreneur.
So: build relationships + make money 🙂
With lots of love,