Frontline Seed

Cold start, hot success – how to beat the VC inbox

Posted 30 September 2019
By Finn Murphy

Being the most junior investor in a venture fund puts you on a pretty steep learning curve where you’re given tonnes of varied responsibility early on in the job.

One such responsibility, being the gatekeeper of inbound investment proposals, tends to be underrated. More often than not, it’s taken on with a lot of reluctance.

Whether it’s the info@ e-mail, a form submission, or cold contacting investors, there are usually a number of routes to get in touch with investors without needing a warm intro. However, it’s not as simple as a mail merge. If you’re looking for responses from cold emails, you’ll have to do some groundwork, and follow some key rules.

Investors (people) are busy

Investors spend a huge portion of their day trolling through their inbox (that’s why we see such VC <3 for companies like Superhuman & Consider). Between new prospects, portfolio co’s, general admin and meeting coordination, there’s a lot going on. As someone sending a cold email into this system, you have to remember you’re dropping into that maelstrom – incognito.

Investors (people) have limited free attention

A function of being busy is learning to assess and prioritise work tasks and opportunities efficiently. For example, you can often figure out how important (or not) an email is simply by looking at the subject line. You can 100% prioritise from the first three sentences. When drafting, remember this: it’s not that people get bored. It’s that priorities are set quickly and you need to signal, from the offset, why you should be a big one.

Investors (people) like to see things that specifically interest them

This feels obvious – but, based on my experience, it’s anything but. Everyone has preferences. The more closely suited to someone’s preferences an opportunity is, the more likely they are to dedicate time to it. This is why looking through investment opportunities is kind of like browsing Netflix – there’s definitely good stuff on there and the odd trailer might catch your eye, but at the end of the day you like James Franco, so you end up watching Pineapple Express for the third time (or you end up investing in another e-scooter company).

Do your prep

What exactly does your company do?

This seems obvious again but: what is the single sentence that best describes your company? Next up: what stage of investment are you at? What country are you operating in now – and where do you plan to be physically located in the future? What sector are you in, and is there a technological or market trend you’re leveraging to build your business?

Who will it interest?

Once you’re clear on what you do, you may start looking for investors (Top Tip! FYI – I’m not being paid by Crunchbase here – but if you’re running a venture-backed start up then a subscription to Crunchbase Pro ($360 for the year) is well worth it).

You can quickly run a search of investors that have invested at your stage, in your geography and in your sector in the past 24 months, and get a detailed list with partner details, angels who participated in the round, and more.

CB Search: London Based Investors, Invested in a Seed round with a cheque of $500k-1M, in a London based company, in the past 18 months.

Is there a relevant or complementary company in the VC’s portfolio?

Again, the magic of Crunchbase allows you to see the fund’s recent investments, and can give you a contextual nudge that you can place in your email to further intrigue the investor and show them you’re someone who actually does their research.

The target and the guessing game

Junior investors (depending on the fund) are **super** thirsty for deal flow. They also have a surprising amount of knowledge when it comes to shepherding deals through the labyrinthine process that is a venture fund partnership’s decision-making apparatus.

So, first figure out who in the fund you are going to email. Do not mail multiple people; it creates a weird dynamic in a fund where people wait for the other person to run with it. Find the person in the fund you think most relevant and accessible to you. If you go for a partner and they don’t reply, hit their associate. It’s more likely that the partner is busy rather than ignoring you because they are uninterested (but they might be 🤷‍♂️).

The e-mail 

You can just e-mail info@generic.vc to throw your hat into the ring. That said, many funds don’t read their cold e-mail (their loss) – so your best bet is to examine your target list of investors, and take a stab at guessing their direct email. There is a 99% chance it’s one of the below.

  • firstname@Generic.vc
  • firstname.surname@Generic.vc
  • firstnameFirstletterSurname@Generic.vc

Once you’ve completed all of the above, start drafting your email. This isn’t a manuscript to spend hours on. It’s a quick, simple message. There are, of course, some basic dos and don’ts.

DO

  • Include a single simple paragraph explaining what you do and why you’re relevant to them (some small personal details – don’t go too heavy or you run the risk of coming across as creepy)
  • Include a maximum of  five bullet points on the most interesting aspects or achievements unique to your business.
  • Hyperlink throughout (if you’ve relevant support on the web – your LinkedIn, website, press, etc.) and attach a single compelling PNG (easily visible in browser preview – graphs that go up and to the right are always good 🙃).
  • Craft a clear ask: do you want a call, to schedule a meeting, or to share your deck? The first email is NOT about getting their  investment – it’s about getting their interest.

DON’T

  • Waste words on unnecessary preamble (they’re VCs – of course they had a lovely summer).
  • Contact investors who don’t invest in your sector
  • Use generic statements like “we’re working hard to…”
  • Message people on LinkedIn (it works, but it sucks)
  • Attach a slide deck with 30+ slides

The follow-up

Once you’ve sent the mail, rinse and repeat for your next target –successful companies have a 30/1 first-meeting-to-term-sheet ratio. You need a stacked funnel to have a high likelihood of raising.

If you don’t hear back within a week, then you should absolutely send a follow-up. Sometimes emails get missed and most good investors will give you some sort of response. Your goal is to get them to ask for the deck and to set up a time to speak.

The good

The example below is pretty much as great an effort as you can find. It’s made better by the fact that, in a subsequent email exchange, the founder mentioned he was also chatting to two other competitive seed funds, one of whom we had recently lost out to, on investing in a company we really liked. FOMO is real folks. It’s on you to harness it wisely.

No alt text provided for this image

Modulz recently announced their total funding of $4.2m – Colm will one day write a blog on how he also cold-tweets people to great effect

Sliding on into that inbox

This e-mail resulted in us leading a $1m+ pre-seed round into the company. As far as cold emails go, it is clear, intriguing and allows me to easily do some additional research and get bought into the company, without having to actually speak to the founder. By the time Colm and I spoke, I was already very excited about the company.

It’s not easy – and the hit rates will definitely be lower than via warm intros. But if there’s one thing I’ve learned from reading thousands of cold emails, it’s that the reason most fail isn’t because they’re cold – it’s because they are just plain bad. Put some effort into it. I guarantee it’ll pay dividends.

Much of the above can be modified for cold e-mailing anyone – don’t just try it with VCs! New customers, potential hires and great partners can all be sourced through a well written e-mail sent at the right time.

Much thanks again to the proof readers – Alexia, Carolina & Edmund.

If you’re raising funds for an early stage b2b software company plz hit me up ice cold on finn@frontline.vc

Related

Press enter or esc to cancel