3 Tips On How To Meet Investors
A Deeper Dive w/ Bay McLaughlin
The first thing to know is that investors are not your customer, they’re simply one tool for you to get the funding you need. This misconception is one of my biggest pet peeves.
The fact that investors have become the rockstars of the valley rather than the founders, who are the ones taking the real risks to improve the world, bothers me.
While you do need some capital, you shouldn’t make gaining access to us the focal point of your efforts. There is capital in every corner of the world and VC capital is not the only type — and usually it’s not the right type.
So to answer your question about how to gain access to us investors, I will start with the best tips and tricks I’ve learned from my time hustling. I will also address some of the mistakes I have made in past to avoid.
1. The Familiarity Hack:
Familiarity is a kind of proxy for trust. It can mean as little as ‘I’ve heard of this idea/founder before’ all the way to ‘I’ve had other investors/founders tell me about this founder.’
You can hack both of these without really knowing the people who introduce you at the end of the day. My favorite and the most democratized tool is social media.
One of my favorite ways to ensure familiarity with the growing investor and founder community is to introduce myself to everyone on as many platforms as they feel comfortable on.
I use tools like FullContact, Rapportive, etc. and ensure to add context whenever I can… ‘We spoke at so and so event last quarter’ or ‘we share a lot of similar friends in the autonomous driving space’ etc.
The more context you can provide when you do reach out and the more reference-able or ‘trustworthy/familiar’ you can seem, the better.
Content creation and being present on the right online communities is also key. Medium is an obvious one as it’s become the tech community’s default blogging platform. Reddit and Hacker News are others.
I’ve also built up a lot of familiarity on Whale, which I recommend as video helps create a sense of familiarity much faster than text, even though not everyone watches video. Podcasts are also growing fast in recent years.
2. The Triangulation Hack:
But sometimes, no matter how much you attend to your social outreach, the people you really need to connect with don’t pick up on your brand naturally.
Sometimes, you need to find that one investor and seriously target them. Triangulation is the best way to get those tougher investors out there. Even with a strong endorsement, which is extremely powerful, it’s always better to come across someone’s desk more than once.
We are all very busy and even a good introduction from a close connection can be lost in the shuffle. So it doesn’t hurt to have a backup plan, even if it’s just a mention on social, a connection request, a like, comment, or video response on the investor’s latest social post.
These usually go from the most effective, two warm introductions from other investors or founders that are willing to introduce you, all the way down to multiple social connections that will mention you with them on twitter.
3. The Persistent Hack:
Being persistent, without being pushy, will always be a killer skill to learn as a founder. Remember, investors are only part of your equation. It’s important to be memorable, push for what you believe in.
Ultimately always find a way to get what you need for you business. Persistency is best dialed up when you have something truly interesting and when you have some leverage.
‘The worst time to to get loud and on an investor’s radar is when you’re weak and need financing as a last resort.’ — Bay McLaughlin
The worst pitch line ever: ‘We just need money to get started/find users/get traction’. This is one of the oldest jokes in the book. We see it at every pitch event.
If only you had money, then you’d be able to start. Bullshit. Start now and gain every inch that you can in the meantime. You’ll never stop pitching someone, but you should be strategic when you’re hitting up investors.
You can also be persistent in the way that Gary Vaynerchuk always recommends… give, give, give… ask. Find ways you can support or provide any positive vibes to the investors you want to target before you ask to pitch them or get introduced.
It doesn’t have to be anything big. It can be liking, commenting and sharing their content ;-) or making an intro for one of their investments as a way to show support for their founders (also a nice way to make a friend). How about sending other good deals you see their way unsolicited.
Frankly, your voice will have to really break through the noise, but it is the fuel that feeds the investment fire, so if you can even find one opportunity that the investor reviews seriously, you’ll be on their radar from here on out!
What NOT to do:
Don’t ask for an intro to an investor until that connection understands your brand…
- Actually, don’t do this in any part of your life. It feels weird and makes the person you’re asking feel awkward. They have to defend the person they know because they wouldn’t want someone else doing this to them.
- have to deny your request, which doesn’t feel good and you won’t feel good being told no for something you’re truly passionate about. Find a way to add value first. Maybe ask questions about the investor first. What is their current investment focus? How do they best like to be approached? How can you provide value to them?
Don’t show up at their offices…
- This happens more often that you may think and it isn’t cool. It’s one thing if you’re showing up to a co-working or maker space, but most investor offices are invite only. Think of this like someone’s home. You need an invite first (this happened to Justin Kan and he wasn’t psyched about it :-). This is almost always a quick way to make an investor’s shit list. And if you manage to not piss off the investor, you may still annoy the office manager, the gatekeeper per se of the office. You don’t want to burn another good way in.
Don’t expect to pitch them after a conference…
- While it may seem like a good time to meet investors and important speakers, it usually isn’t. You’re one of hundreds, if not thousands, of people that want to meet investors and famous founders at these events. If anything, find out where they’re going out for drinks and casually be there (hopefully with friends), and offer to buy them a drink or find a normal way to get into a conversation. ‘I saw your talk today and I loved your point about XYZ’ or ‘ XYZ person told me I should try to find you at the conference… do you have 5 minutes so I can get some advice from you?’
Don’t pitch then on ideas they don’t invest in…
Do your research… being persistently wrong is a really easy way to earn a negative badge of honor in the investment game.
- I’m constantly surprised by how many of these I get online, especially LinkedIn and Twitter where you can read my profile. At an event where we have an investor badge on, that’s understandable because the badge doesn’t usually say our stage or vertical. But online, it’s unacceptable and shows laziness. Don’t do this. Take the extra 2 minutes it takes to read their profile and thesis and make an approach only if you fit in.
Finally, don’t impersonate an Uber driver :) Don’t be an Erlich Bachman…
My Thoughts on Current Investor/Investee Dynamic
*Caveat: This is me waxing philosophical :)
Being an insider in tech, I don’t underestimate it’s challenges and issues. The main thing to know here is that this dynamic isn’t only in investing or tech.
People want to know that they’re not going to waste their time and we all use trust or familiarity or warm introductions to make better use of our time. It’s one of our only tricks as humans.
But while this methodology may seem prudent for the investors, it’s not all perfect.
Pros:
- It helps investors stay focused as there’s no end to the ideas we could be reviewing
- It’s also one of the reasons why we all have a thesis
- It creates investment families where hot deals get a lot of funding, which can both help diversify the brains in a deal but also give a good company more capital if they need it
Cons:
- It does create a bit of an echo chamber
- Good ideas do go unseen, but you can also argue that ideas are a dime a dozen and that a good founder will find a way to get noticed
Learning how to network is as paramount of a strength for a founder as having strong technical or operational knowledge.
Make sure you know how to navigate this complex landscape. And never forget: Don’t be an Erlich Bachman.
