Connecting and Pitching
Pitching to an angel for seed money is different than pitching to a VC for a Series A and is different than pitching to a PE investor for a Series B and so on. Even figuring out how to get on someone’s calendar after someone introduces you is a skill.
I have introduced founders to investors and have witnessed their response in my email box and then have forwarded the response to them saying this would be a better response. Each time I have done that, the founder is thankful because they honestly had no idea how to respond appropriately. No doubt this skill is part of the endless “sale” founders make to get the right investors and get capital into their business.
I learned early on, to make the person’s life on the other end of the email easy. The response should roughly be, looking forward to meeting, how is this day and this time and give two options. They will respond yes to one of them or give you a different one. Don’t give them an out by putting the schedule into their heads. Whatever works for them, will work for you, even if you have to move your calendar around. Also, go to them. They are giving you their time and hopefully their capital so go see them.
Talking to angels about investing is selling a dream. It is about believing in the vision and most important believing in you. There isn’t much else there and even if there is, it will change. I believe it is important to find a connection. It could be anything from other people you know to your love of restaurants but find something personal. Business is business but we spend a lot of time on business so finding a personal connection is an added bonus.
Raising a Series A means you actually have a business model that appears to be working. You are still selling a bit of the dream but at this point, you are selling a team, tangible numbers and how the next round of capital is going to get you to the next level. The data points are necessary but there needs to be some big-picture thinking here in regards to the size of the market and what separates your company from the crowd.
Raising Series B is all about facts. Numbers should be proven, the team should be solid, money in creates value and revenue that you can point to. They know how big the market is and understand the opportunity but want to see deep into the analytics to understand that the money is actually going to grow the company, send it into an abyss or hit the wall.
Founders do your homework. Know exactly who you are talking to when you enter the meeting, or for that matter before you even reply to an email. Only ask for other introductions when it feels appropriate. Feel the room and the tone. Listen, as pauses are ok. Don’t ramble. Shake everyone’s hand and look them directly in the eye. Put your phone away. Be on time. Have an intellectual meaningful conversation around your vertical. Think of these meetings as courtships. You are courting them as much as they are courting you.
Above all, make sure when you get that connection that you have what the people on the other end want to see. Don’t try and pitch a Series B investor when you are at the seed level. Don’t go see VC’s when you are still in true start-up mode. You generally get one try so make sure you have everything lined up and even if you don’t get what you are hoping for, you know you did all the right things at the meeting and if you did, regardless if they invest or don’t invest, you have built a relationship that you can come back to in the future.