Automated outreach to investors is a sales process requiring preparation and persistence. Here we’ll share lessons from running hundreds of campaigns to investors.
Success often depends on which investors you’re targeting more than the specifics of what you say to them, while LinkedIn is more effective than email.
How should I automate my outreach to angel investors?
This is a three-step process:
- WHO (Investor Selection): Use data to find relevant investors and when building your target list, filter by:
- Industry: Do they have an existing investment in your space?
- Recency: Are they investing now?
- Investment size: Do they have the capital to invest at your level?
- WHAT (Outreach Messaging): This is the message sequence you will send. Brevity is your friend.
- HOW (Automation): Use an automation tool to run the campaign from your LinkedIn account so the campaign runs in the background while you focus on investor conversations.
What is an effective outreach message sequence?
A successful automated campaign creates intrigue and uses a soft call to action. Every campaign is different, but here’s an example:
- Step 1: Send a blank connection request; this is designed to create intrigue.
- Step 2 (Follow-up): Once connected, send your message. This should include your pitch (e.g., “We just kicked off fundraising for Airbnb…”) and your social proof (“We have £175k of our £250k round committed…”). Try a soft call to action: “Would you like to see our deck?”
- Step 3 (Follow-up +3 days): Share more content, like a quick video link. Now you can use a harder call to action with a calendar link.
- Step 4 (Follow-up +7 days): If you haven’t heard back, send a polite “Closing message”. Assume the timing isn’t right and let them know you won’t share more messages.
What are the 9 biggest lessons from 100+ campaigns?
- If you’re early, soften the language. Your “ask” should change depending on your stage. If you’re pre-revenue, you can ask for advice. If you have traction and early commitments, you can be more direct: “We’re fundraising, join us”.
- Follow-ups book meetings. Investors are busy, with many meetings booked only after the 2nd or 3rd follow-up message. Just like in sales.
- Investor selection matters most. Who you’re targeting is more important than precisely what you write in the outreach messaging. You can find your “tribe” by focusing on your sector.
- Fundraising is a numbers game. Treat it like a sales funnel and a sales process. Meetings are hard to get, but those meetings are highly likely to result in an investment.
- LinkedIn is more effective than email. LinkedIn outreach campaigns see reply rates of around 20%. In contrast, cold email reply rates are often less than 1%.
- Your LinkedIn profile matters. Before replying, investors will check your profile. They are judging you on five factors: size of network, mutual connections, relevant experience, ability to communicate, and focus.
- Some industries are just easier. Investor appetite changes. Sectors like Life Sciences, B2B FinTech and industry-focused SaaS have an easier time fundraising, while industries like consumer apps, recruitment tech, property tech and snacks are tougher.
- Timing is key. Investor excitement is not linear. There is often a “peak pre-revenue excitement” moment. This can be followed by a dip, with the next peak coming once you have lots of traction.
- Stay organised and ask for introductions. Keep track of your conversations and when an investor is interested (even if they pass).
What are the most common mistakes founders make?
- Giving up too quickly, expecting it to be an easy process.
- Targeting the wrong investors at the wrong time.
- Raising when the business isn’t ready for investment yet.
- Making it difficult for people in their network to make introductions.
Be persistent, follow up and keep going. Good luck!