How Smart Founders

Find Investors


One of the hardest parts of building a startup is finding good investors. At Quibb, the social platform for industry news, we’ve been collecting stories from experienced entrepreneurs about how they choose and categorize investors. The advice below is from Jason Shen, who co-founded a startup backed by Y Combinator, and Kate Kendall, who’s currently CEO of the social media professional marketplace CloudPeeps.


“Founders who ask for generic ‘intros to investors’ aren’t ready to raise money,” says Kate Kendall. She’s the founder and CEO of the CloudPeeps, a freelance marketplace for marketing, content and community professionals. “It shows they haven’t really thought about it and done the research to know who would be interested.

“People think of investors as these broad categories of individuals,” she goes on, “but each investor has such a niche approach, and after digging into it you can see what markets they like, what they focus on, how fast they can act. Eventually you know so much about the investor community that you save time because you don’t pitch all the investors.”

Kendall notes that painting investors with a broad brush hasn’t worked for her, even in situations where it intuitively seems to make sense. For instance, her initial approach was to target all the female angels she could find, but that wasn’t the best approach. “When I first started fundraising I thought, I’m a woman, so I should go chat with women,” she says. “But the fact is, all I have in common with them is our gender. Sometimes that’s enough, but there’s way more in common with people in my space. I saw more success with investors who are generally interested in social media, versus trudging around town talking to all the female investors.”

Quibb’s founder, Sandi MacPherson, saw a similar trend when she raised money one year ago. Even after opening up her fundraising to all Quibb members via an equity crowdfunding process, very few women expressed interest in investing. Today, there’s only one female investor in Quibb, and she’s a close family friend. (For Quibb, investors associated with Bloomberg ended up getting involved, as well as the media-focused investor Betaworks, and other ex-media professionals.)

Kendall also specifies that you want to be sure to find investors who will add the most value — not just money. Often, that means investors with a strong entrepreneurial history themselves. “In the early stage round, you have to be careful you’re taking money from people who are really going to add value,” she says. “A lot of people in our round have been entrepreneurs and had exits, and now they’re investors, so they really understand the challenges of the entrepreneurial journey. We also have investors who are building companies right now, which is great because we’re all peers and we can share our journey.”

As an example, Kendall cites David Bill, who has a background as co-founder and CTO at CoTweet (which was acquired by ExactTarget). “His involvement from the product side has been incredible for us. As we’ve scaled our marketplace, he suggested turning it into more of a talent community, and has made a lot of solid product suggestions to back that up.”

Of course, you don’t want too many cooks in your startup kitchen! “You have to round out your round with people who are both more hands-on, and less hands-on,” says Kendall.

Jason Shen is currently a product manager at the marketing software company Percolate, and he previously co-founded the ridesharing company Ridejoy, which was funded by the prestigious startup accelerator Y Combinator. Based on his experience with Ridejoy, Shen offers some thoughts about how to categorize different investors’ attitudes.

“Some investors are very focused on the future,” says Shen. “They want to know: What does the end state look like? How does this become a billion-dollar company? While other investors are interested in things like: Where are you right now? What are your next moves? That’s the future vs. past orientation. And then there’s product-oriented and market-oriented investors. Product investors say: Let me see the UX. They ask: How does it work? While market investors want to know: How do people buy this? What industries are the buyers working in, and what are adjacent markets you could walk into? Finally, there’s investors who look at different strengths in different ways. Some investors only care about the idea, and others only care about the team.”

To drive the point home, Shen gives the example of his “first and only one-meeting-check-signed situation.”

He recounts: “We were introduced to an angel investor who had been an executive at Amazon, and we were telling him about Ridejoy, and you could just see his eyes glazing over. So finally I just stopped and asked, ‘How do you invest? What do you look for?’ He said, ‘I’ve never been an idea guy. I joined Amazon because of Jeff Bezos. I invest in people and teams.’ So then I re-started the pitch. I told the investor about how my co-founder Kalvin and I had started a nonprofit together in college, and I gave him a lot of details about how we hire and how we think about our team. It turned him around on the spot.”

As Shen puts it, the unavoidable conclusion is: “Be ready to pitch different people in different ways.”


Find other stories about professional experiences like Jason’s and Kate’s by joining Quibb. You can follow Kate to see what she’s reading for her job as CEO of CloudPeeps. Follow Jason to see what he’s reading for his job as a product manager at Percolate and all-around tech world guru.

Thanks to Lydia Laurenson, writer and media strategist, for her work on this series.