Today, you might be cold emailing investors, but tomorrow, you might be raising half a billion dollars with a basic PowerPoint, thanks to your prior success.
Eric Berry, managing partner at Bedford Bridge, has seen just that happen with his brother. Berry himself sold his company for just under $1.5 billion, a deal that marked one of the most significant cash returns relative to cash raised in the New York tech scene’s history.
What catches Berry’s eye now as an investor? Spoiler alert: it isn’t AI. “I don’t really care about whether it’s AI or not,” says Berry, “I just care about the value it delivers to the customer.”
Meanwhile, Mitchell Harounian, investor associate at Talent Resources, says his interest is piqued when a company solves a problem and has a total addressable market (TAM) of over $10 billion. But more than that, Harounian wants to know what motivates founders and why you’re the perfect person to build your company.
How do you get in the room or on the call to answer these questions and deliver that presentation to move investors from interested to invested? That’s what you’ll find out below.
We gathered advice from influential investors who spoke on a panel co-hosted by the Founders Network during New York Tech Week. They revealed their communication preferences for when founders pitch them so that you can make every communication count.
Do: Send cold emails (but also do your homework)
To Harounian, cold emails go a long way, and some of the best founders are great at cold emailing — provided you do your homework and ensure it doesn’t look like a mass email.
Just how far can a cold email go? David Beisel, the co-founder & partner at NextView Ventures, once invested in a company from a cold email. “It was a perfectly tailored email,” explains Beisel. “They knew the companies I invested in, how they fit into that cohesion, and why it was different…And it resonated.”
Don’t: Be overly defensive toward investors’ questions
A company could be an absolute standout, but if the founder is too resistant or rigid, that’s a major red flag, says Sumeet Shah, founder and managing partner of VHS Ventures. And it’s caused him and his team to pass on investments.
“Our job as investors is to mitigate risk, and so I will ask some difficult questions as we go along our due diligence processes,” says Shah. The founders who mindfully consider these questions answer with a very thoughtful response or work towards giving him an effective answer, even if they need to get back to him.
However, this doesn’t mean always following feedback, adds Beisel, who notes that retaining confidence in your vision is critical as a founder. However, do listen to and thank investors for feedback.
Do: Network with investors—in and out of your space
When looking for investors, see if you have existing mutual connections. Doug Lessing, who leads the NYC Founders Network’s NYC Chapter, recommends making a list of (20+) VCs in your target market, asking relevant connections if they know someone, and being hyper-specific with requests for introduction.
You can also seek out investors at networking events, inserting yourself in rooms where influential conversations happen. And should you enter one with an investor who is not in your space, don’t lean away. To Shah, if you can create a compelling argument about what your company’s building, they will keep you in the back of their mind, and that connection may be fruitful later.
Don’t: Fear the follow-up
Say you have a meeting with an investor, and while the meeting goes well, they (or you) aren’t ready yet. Don’t hesitate to keep that investor updated.
“Anytime you have a reason to reach out, reach out,” Harounian offers. “When you do, whether it’s closing 10,000 or 100,000, what I’m measuring is how much you’ve done since I first spoke to you.”
Shah also suggests asking investors what they want to be updated on and whether any specific metrics would be useful to keep in mind as you continue building.
Remember, too, that people will naturally follow up with you as you grow. And even if you’re still not ready, it’s a powerful message to say you’re not raising (right now) and ask if you could get back to them when you are, suggests Lessing. “But when you are ready, be fully ready,” he adds.
Do: Bookmark this to read next
With potential money and support on the line, pitching investors can be stressful. Set yourself up for success by protecting yourself from undue stress as you go.
Bookmark this article to discover how successful founders have taken care of their well-being throughout the founder’s journey—so you can, too.
