Effective investor outreach is a process that combines research, personalised communication and strategic networking. Simply sending a cold email to a generic list of investors rarely works. The goal is to build a relationship and the first step is to earn a meeting by demonstrating that you’ve done your homework.
Here we’ll share some key investor outreach strategies that actually work.
Research and personalise your approach
Before contacting any investor, you must do your research. Not all investors are the right fit for your business. First, study their portfolio. Use platforms like Scribe, LinkedIn or Crunchbase to review an investor’s past investments. Angels often invest in the same industry multiple times, so keep it relevant to your sector.
Next, you’ll want to understand their investment philosophy. For example, if they’ve written about investing, read what they’ve been sharing online to understand their investment thesis and see what they are passionate about. Then you can use your research to craft a personalised message that highlights exactly why your startup is a good fit for them. Perhaps reference a specific past investment or a recent comment they’ve made online, showing that you’ve done your homework.
Prioritise warm introductions
A warm introduction from a mutual connection is often a lot more effective than a cold DM. Investors trust referrals from people they already know and you can use commitments from warm introductions to gain momentum in your funding round.
Firstly, use LinkedIn to identify mutual connections between you and your target investors. Then you can leverage your existing professional network by reaching out to mentors, advisors, lawyers, accountants and other entrepreneurs in your network who may have connections. When asking for an introduction, be specific about who you want to meet and why. Make it easy for your contact by providing a short, forwardable blurb about your company.
Scale your cold outreach
As you build out your funding round, cold outreach can accelerate finding investors, particularly if you have some investment commitments already.
Focus on investors who back your industry, have invested recently, and write cheque sizes that match your round. Strong targeting does most of the work in cold outreach. Also, you’ll want to build instant credibility, so there should be a reason for you reaching out. Perhaps you’re looking to finalise a funding round, share milestones or get their input. Make the ask easy by keeping it short, specific and easy to respond to (e.g. an intro call). A concise message with a clear next step always helps.
Adopt a value-first mindset
If you’re early, your initial goal should be to get advice and feedback, not to ask for money. This helps build rapport and trust with potential investors who will be with you for the long run. In your first meeting, focus on the investor. Ask for their perspective on your business model and strategy. Try to understand their motivations for investing too.
Fundraising is also a long-term game, so it’s a good idea to start building relationships with potential investors early, ideally before you need capital. Send them email updates on your progress. Find authentic ways to add value to the investor’s life or business long before you have an ask. This could be as simple as sharing a relevant article, inviting them to an event you are going to or offering an introduction to someone in your network.
By ticking these things off, you’ll put yourself in a great position to secure that first meeting with an investor.