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Approaching angel investors - cold outreach vs. soft warm intros?

What are folks' perspectives on the best way to approach investors (that aren't already in your personal network or within 1 degree of separation)?

Option #1 -- pure cold outreach via email. Find their contact info online, email them a very brief, to the point description of your company and ask (advice, investment, etc., NOT a coffee/call), as Michael Siebal at YC suggests (source).

Option #2 - track down the contact info of one of the founders your target investor has in their portfolio, reach out to them cold, ask about their experience with so and so as an investor, and ask them to make the email intro.

Thanks all! Relatedly, I'm starting to gear up to raise an angel/seed round in the ski technology space. Open to all suggestions of trees worth barking up, and DM me if you want to hear more about the project.

13 Replies

ajay rajani
4
0
ajay rajani Advisor
Entrepreneur & investor. Aspiring merchant of progress.
I'm a pretty active seed investor. Cold ONLY works if it's done with a high level of specificity / matching (I.e. if an investor has invested in tangential companies or better yet blogged/tweeted about their interest in XYZ problem/market/etc).

For anything but that level of investor-market/problem fit, worth the time to find/get a warm intro.

Hope that helps!
Ken Steinberg
1
0
Ken Steinberg Entrepreneur
Innovator and Serial Market Disrupter
I too am an angel....warm.
Rosalyn Lemieux
0
0
Rosalyn Lemieux Entrepreneur
General Manager, Attentive.ly at Blackbaud
+1 a warm intro is always best.
Joy Passey
3
0
Joy Passey Advisor
Entrepreneur Coach; Speaker; Multi-Talented Creator; Dive Master
I just got back from the NY Venture Summit. The main thing investors said when emailing them: they want to know why you chose THEM. Doing a mass email to 100 investors turns them off. Do your homework about each investor to make sure you are the right fit for them. Why do you want them specifically to invest in you? Also, know what you need, besides just money. What else do you think that investor can bring to you? They talked a lot about having a personal relationship with the people/companies they invest in. They're not someone who just gives money, but you're building a relationship with them. Hope this helps!
Mark Buckle
2
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Mark Buckle Entrepreneur
Co-founder and CEO at Amondo Ltd
To underline Joy's point, the modus operandi has to be to stop being so passionate about your company just for a second and think about the investor first: How can you either disrupt the flow of his/her day (in terms of sheer impact of message), or how can you charm them into some form of 1-2-1 dialogue through something a little more empathetic (probably about them?)

I was at an event recently where a sophisticated angel investor summed up the process neatly by stating that he spends the whole time with proposals getting to reasons NOT to invest in projects as efficiently as possible! Your e-mail header is likely to be the first gateway... ;o)

Finally, another hard-learned tip: You are not selling your product (even if it IS the next Facebook etc. etc.), you're selling an investment. These guys are looking for the the 1 in 10 that will actually deliver a return, letalone transform into the next Unicorn. The smart ones are real pragmatists.
Martin Omansky
1
0
Martin Omansky Entrepreneur
Independent Venture Capital & Private Equity Professional
I represent angel investors, and so I have some perspective. The bottom line is that the project's fundamentals govern. We get referrals from investment banks, lawyers, former clients, etc. and cold calls, Internet inquiries - all sorts of sources. I can only speak about our groups, but I am pretty confident that the rational approach to evaluating a deal is to invite all comers, look at their proposals, and put aside how the deal arrived. One more thing: there are so few risk investors and such a great demand for risk capital that no one should exclude any possibilities. Sent from my iPhone
Nathan Beckord
1
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Nathan Beckord Advisor
Co-founder and CEO at Foundersuite
I've seen anecdotal data on this from users on our investor CRM platform, and the warm intros are roughly 10x more effective at leading to a meeting / call.

If you're reasonably well-networked, you can typically find a 1st or 2nd degree connection (using LinkedIn etc) 80-90% of the time...for the remaining 10-20% as others suggest, a specific highly targeted / researched cold email will *occasionally* lead to a response. For "popular" or well-known investors, the response rate from cold drops to almost 0, however.
Brian Bensch
0
0
Brian Bensch Entrepreneur
Founder & CEO at Snow Schoolers
Thanks all. Very much appreciated. Considering that in order to do cold-outreach well you still need to spend a good deal of time crafting the right hook for that individual, might as well spend that time networking to get the warm intro.
Joy Passey
1
0
Joy Passey Advisor
Entrepreneur Coach; Speaker; Multi-Talented Creator; Dive Master
And remember when networking, be nice and helpful to EVERYONE. Don't let looks and title deceive you. You never know who people are and who they know. Plus, it's just courteous to be kind to everyone. No one wants to work with a jerk.
Troy Sheets
0
0
Troy Sheets Entrepreneur
Executive Producer / Business Development at Blue Shift, Inc.
I have only had success with warm intros, but my industry (gaming technology)is flooded and I don't expect much from those efforts. I do expect to get better traction the closer I am with the content. If it's a game design, a playable prototype. If it's a piece of technology, a demonstration that shows it's impact. I spread the word on social media and then use the activity from that to get noticed.
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