Finding the Right Investor
Transcript
Welcome back and thanks for all the feedback. One of the most common things that I heard was we've been talking about how we construct these decks and how we build a great one, but we haven't told you how to actually get into the investors and how to actually deliver the pitch. And so that's what we're going to cover today.
So the reality is that pitching an investor is no different than any other sales process.
It starts with a funnel and you have a target list at the top, you narrow down, narrow down
through the sales process until you close.
And in this case closing is getting investors.
And so where do you find that target list?
So you're looking for investors.
This is true whether they're angel investors or venture capitalists who have made investments
in businesses that are similar to yours in a similar industry that have similar characteristics,
fast businesses or e-commerce or whatever it is that you are, but are not direct competitors.
And so you can find those on AngelList or on Crunchbase and do some research and develop that target list.
And then, once you have that target list, the next step is to get introductions.
Sure, you could do a cold email. Those rarely work.
The best practice is to find somebody who you know who knows the investor that you're trying to reach
and have that person forward an email that you created for them specifically for that investor.
So if I were pitching my company to a particular investor,
I would have a custom email for that investor that introduced myself,
talked about how great I thought the fit was, being very specific about prior investments.
This is going to be a great fit for you because of your experience doing this SaaS company,
this SaaS company, and this SaaS company.
I really love what you've built in your history, blah, blah, blah.
A little flattery will go a long way.
It's amazing, so don't be shy about that.
And then you attach a one-pager, not your deck.
The one-pager is a teaser.
It's sort of like the trailer to the movie.
It's supposed to build suspense but not tell how the movie ends.
It's supposed to talk about your company, the size of the market, how excited you are,
but not tell the whole story because you want to evoke that emotion of,
I want to find out more from the investor who will likely then ask you to send a deck.
And your response should be no.
Don't send the deck.
Early stage investing is all about people.
You're never going to get an investment unless you've met face to face with the investors.
And by face to face, ideally it's in person, but it could be via video.
So you hold the deck hostage to get the meeting.
When they ask for the deck, you say, oh, you know what?
My deck is really meant to be presented.
It's just a framework for a discussion.
How about if we meet next Tuesday?
or would Thursday be better for you? Hold the deck hostage to get the meeting.
Now, in the meeting, how do you construct the meeting? Here's the challenge. You have this
deck that outlines everything you want to say, and the meetings that make you feel good, where
you get through every single slide in sequence, are the worst meetings for the investor. See,
this is about the investor. And so what the best meetings are, those that you're most frustrated
in. When you get to slide two or three and the investor starts asking you, tell me about customer
acquisition costs. Tell me about your team. Tell me about your sales channel. Tell me about,
and the next thing you know, the meeting's over and you feel like you didn't tell them half of
what you wanted to tell them. But it's not about you. You did tell them everything they asked you
about. And so it was a great meeting for them. And of course, as with any sales process, make
sure you follow up well. So after the meeting, email thank yous to everybody. Make sure you
got cards and email addresses. Thank yous to everybody with a copy of the deck that you
reviewed any other material and then what your next steps are. If you follow this
process, sales process, looking at the top by getting great targets who've
invested in companies that are similar to yours but not competitive, you develop a
great one-page teaser, hold the deck hostage to get the meeting, execute a
great meeting, and follow up well, that should increase your chances of getting
investment. I hope this helped.
We’ve talked about how to construct a great deck, but how do you get in front of investors and make your meeting count? In episode six of MATH 101, Troy dives deeper into the fundraising process talking about how to identify key investors, getting the meeting, how to pitch, and the follow up. Remember, it’s not about you, it’s about the investor.
Originally published on the MATH Venture Partners blog.