Raising from angels is hard, especially for first-time founders. Relying on a single approach or being too tame often won’t work. The most successful founders treat fundraising like a multi-channel sales process and use disruptive tactics to get noticed.
Why is my approach not working?
If you feel like you’re kissing frogs, you’re not alone. Fundraising is competitive and many first-time founders have small networks and a lack of sales experience.
The most common reasons for failure are:
- A single-channel strategy: Relying on just one channel - either your network, pitching events or cold outreach.
- Tameness in approach: Expecting that a few small actions will absolutely yield a result.
- Expecting immediate cash: Not realising that early-stage fundraising is all about relationship-building.
What does a successful fundraising strategy look like?
You must treat fundraising like an enterprise sales process. This means moving investors through a clear funnel, from outreach to meeting and commitment. It’s on you to establish this process and manage it.
The strategies that work are:
- Network before you raise: Start building relationships before you need to fundraise.
- Use a multi-channel strategy: Activate all available channels (data, events, intros, network).
- Personalise at scale: Learn as much as you can about your target investors.
- Use the network effect: Cheques follow cheques.
- Think outside the box: Use fresh ways to reach and engage potential investors.
What disruptive strategies can I use?
Here are five examples of founders who used innovative strategies to cut through the noise.
1. The community-first launch (Rise Coffee)
- Strategy: Rise Coffee used a Kickstarter campaign to validate their idea, build a community and raise funds to make their product.
- Result: They successfully hit their funding target in just 10 days, backed by 111 people.
- Takeaway: Use crowdfunding platforms like Kickstarter or GoFundMe to turn your most passionate early customers into your first investors.
2. The “long-shot” pitch (BATCH LDN)
- Strategy: When the stylist for UK TV hosts Ant & Dec came into their store, the co-founder, Julian Osborne, saw an opportunity. He quickly printed the investment deck and wrote a quick letter.
- Result: Whether Ant & Dec invest remains to be seen, but the founder’s motto “You miss 100% of the shots you don’t take” will surely close their round.
- Takeaway: Always be ready to pitch. You never know where an investment will come from.
3. The hyper-personalised cold email (Yhangry)
- Strategy: Siddhi Mittal, Co-Founder of Yhangry, has a 70% success rate on her cold emails. How? By being authentic and direct. She reached out to the co-founder of ZOE, with a simple message: “Love what u did with Zoe :)“.
- Result: This led to a 1:1 walk that helped her rethink a key hire, saving the company significant time and money.
- Takeaway: Build relationships by asking for advice, rather than just asking for money. In this case, genuine personalisation wins.
4. The no-warm-intros method (Oneshot.ai)
- Strategy: The Founder of Oneshot.ai “didn’t know a single VC” when they started.
- Result: They raised their entire Pre-Seed and Seed rounds from cold emails.
- Takeaway: A scalable, intelligent cold outbound campaign can be just as effective as a warm network.
5. The network effect (Freshpaint)
- Strategy: Freshpaint’s journey shows the power of the network effect, where introductions compound over time. The founder’s job is to “find the believers, not to convince the non-believers”.
- Result: They raised over $700k from introductions that all originated from a single $5k cheque. That first “believer” opened the door to their entire round.
- Takeaway: Your existing investors are your best source for new introductions. Every “yes,” no matter how small, can unlock the next one.