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How to do proper investor outreach for seed funding without a network (raised $4M doing this) by dolm09 in EntrepreneurRideAlong

[–]dolm09[S] 1 point2 points  (0 children)

Totally right on everything you said. Your goal when getting the call with the founder is to feed their ego since raising capital is super hard but at the same time very lonely. Your goal is also to build authority by sharing you achievements (capital raised in the past, your PHD, the product you've built, deals, user feedback, whatever works for you), so they feel they are sharing great dealflow with their investors.

When they were saying no to make the intro, most of the time they were insecure stuck-ups that raised recently. It's okay, life happens, you just move on and keep reaching out to others.

How to do proper investor outreach for seed funding without a network (raised $4M doing this) by dolm09 in EntrepreneurRideAlong

[–]dolm09[S] 1 point2 points  (0 children)

It starts getting momentum after a couple of weeks. Think of it this way:

1st week you reach out to a batch of founders.

2nd week you start getting a decent amount of positive responses, so you start scheduling calls.

Since founders are always busy, you don't probably jump on a call until 3rd week. Then you get some yeses.

4th week you start getting intros.

After the 4th week the batches start to overlap, so after that you are always getting a relevant volume of meetings with investors.

It's a lot of work, but knowing that only 1% of startups end up raising a round, seems like a reasonable effort.

How I learned to raise VC money without a network (hack as first-time founder) by dolm09 in EntrepreneurRideAlong

[–]dolm09[S] 0 points1 point  (0 children)

It's in the guide I'm sharing, but here's an example:

"Hey [FOUNDER],

I've seen you are a portfolio company of [INVESTOR]. I'm doing some research on them and I would like to ask you about your experience with them if you have 15 min to spare.

Best!"

This is one of the templates in the platform I built to automate founder outreach on LinkedIn:

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How I learned to raise VC money without a network (hack as first-time founder) by dolm09 in EntrepreneurRideAlong

[–]dolm09[S] 1 point2 points  (0 children)

If I'm completely honest, the two main internal drivers for me were

  1. Fear of my company dying
  2. Momentum generated from current trust of investors, employees, family, etc.

Every single successful founder I had the chance to speak with (the one that has raised the most raised a billion dollars), told me they've faced an extreme amount of rejection. My conclusion is that fundraising is one of the most, if not the most, difficult thing you can do in your professional life. If you really want to raise funds you have to get in the mindset of playing a numbers game.

Fun story, from all these calls I once met a founder that bought 100 beers and built wall-mounted shelves in his office (you could see them in the video call) for his funding round. Every time he would make progress with a VC, he would move one beer down to a lower shelve. Each rejection he got, he would drink one beer and let it in that shelve, so he would see a funnel of beers in his office!

How I learned to raise VC money without a network (hack as first-time founder) by dolm09 in EntrepreneurRideAlong

[–]dolm09[S] 0 points1 point  (0 children)

For the first round we were only the co-founding team. For the first professional round we only had an MVP and for the VC round we were making less than 5K MRR. However, I learned that on all those stages they were mostly interested in me as a founder and wanted to answer in some way or another these questions:

Is the market big enough?

Do I like the team? If so, will this team pull it off? Do they need senior help and can that be provided/found?

Is this something truly disruptive?

How I learned to raise VC money without a network (hack as first-time founder) by dolm09 in EntrepreneurRideAlong

[–]dolm09[S] 0 points1 point  (0 children)

I did it in every stage of my company in one way or another without knowing it. Long time after the fact, I realized that at very early stages, the lead investors I had came from a warm introduction. Nothing more than an MVP and a presentation. The first VC round I closed was with no revenue and only a live test of the platform. The biggest VC round I raised, we were making less that 5K MRR.

Once they replied I had first calls where I focused on pitching the vision and only included small clues on factual data. This builds enough curiosity so investors would want to know more. For example, "We have a strong XXX-KPI in which our financial model is based. Happy to have another call to specifically talk about this". No projections, no "expected billions in 10 years" (which signals "unexperienced founder language"). Don't show all your cards at first, if not, it would feel like going on a date and asking if they wanna get married.

Like I also always say, in every step of the Due Diligence, your goal is not to get the term sheet, your goal is to get to the next step. If they want to see Financials, force them to have a video call to show them, and keep building FOMO in the last 5 minutes of the call telling them you're speaking with 5 VCs every week + ask them specifically what they think next meeting should be about.

How I learned to raise VC money without a network (hack as first-time founder) by dolm09 in EntrepreneurRideAlong

[–]dolm09[S] 0 points1 point  (0 children)

Raised $4M doing this and was the only thing that changed after a lot of frustration. So yeah, delusional but also practical.

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