Reach Out!
Episode #10 of the course How to start a startup with zero budget by Dr. Donatas Jonikas
Contacting more investors will get you more meetings, but it won’t necessarily get you more money or better deals. DocSend and Tom Eisenmann in 2015 did a study of 200 funded startups that raised $360 million in total. According to the results, if you do everything right, you’ll likely have to contact 20 to 30 investors to get funded.
The good news is that you don’t need to contact hundreds. (Realistically, if you talk to 100 investors and none of them decide to fund you, there is definitely a serious problem in your business idea, your team, the whole industry, or even you!) In any case, it doesn’t make sense to continue arranging new meetings with potential investors until you solve the core problems with your startup.
A good idea is to start by making a list at least 30 investors you would be happy to work with, as well as a list of at least 30 investors to whom your pitch should be highly interesting. Find the match between those two lists, and come up with a list of between 30 and 50 investors you’ll try to reach.
Reach Out to Your Target Investors Daily
Once you have created a list of 30 to 50 target investors and ranked them according to your preference, you should start to focus on the top five angel investors or VCs you’d love to work with. Don’t be in too big a hurry to contact them with cold email or regular online form submissions. These approaches have some chance of success, but not much.
The best way to approach an investor is to identify a specific partner, principal, or employee in the investor’s company. Find them in your network and get to know them: Check their Linkedin profile, read their blog and tweets, and see if they were featured in media. A good idea would be to get an introduction from another founder who has been funded by them or another third party who has had recent and frequent contact with the target investor. It’s not always as difficult as it may seem.
Focus on Building a Profitable and Scalable Business
This is the main reason you will get funded or not. You must do everything you can to build a profitable and scalable business. Define a business that is open-ended and continuously improving. Investors like business ideas based on solid market research from outside experts, especially if these experts forecast a billion-dollar opportunity.
Leverage and Automate Your Business to the Maximum
Every startup should know that there are certain things they have to do that don’t scale. But once you have figured out your processes, try to leverage and automate your business as much as possible. This will help your business scale faster (maybe even without additional money) and save you time, which you can use for building relationships and meeting investors.
Become Visible and Regularly Update Your Online Presence
Try to become more visible on larger and smaller online platforms for startups, like Angel List, F6S, Startup Valley, InnMind, etc. Create your profile, submit projects, and upload product photos and videos. Some of them are large and well known, while others are for niche prop projects and target a specific sector or geographical market. It doesn’t require much time to create your profile and post few updates when they’re available. At the end of this course, you’ll get a link to download not only a list of investor platforms but also all other related templates and swipe files to stay on track and save your time.
These platforms just on their own won’t necessarily bring you investors, but once you get in contact with your targeted investors, don’t miss an opportunity to show that you are a serious startup by having your professional profile available almost everywhere.
Key Takeaway
Focus your efforts on reaching out to targeted investors. If none of them will agree to invest, something may be wrong with what you’re pitching or how you are developing your startup. Take their feedback seriously and make needed changes (at least in the pitch) before contacting other investors.
That was the last lesson of the course. Congrats on completing it ,and I wish you the best of luck with getting funds for your startup!
Download your set of 20 templates and swipe files to build your startup faster. I’ve also prepared a FREE video course on how to create an irresistible offer and win your first clients even if you don’t have a product yet. Enjoy and make use of it!
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