Here’s Judith Dada and Gülsah Wilke’s top 8 tips for startups raising investment:
Warm up your investor introductions
It goes without saying that a warm introduction is what’s needed to break the ice with investors. For those who don’t have the personal network and direct connections necessary to thaw out their first outreach Gülsah suggests to “find communities or VC hours to make that connection. It doesn’t have to be through a person — you can also be connected through a program like Stealth Mode.”
Embrace the odds
Let’s face it: investment is a numbers game. Make sure you’re reaching out to the right volume of investors to seal the deal and secure your investment. You need to play the odds to win.
“If you speak to 10 investors, that won’t cut it. You need to speak to dozens if not 30, 40, 50, 60 investors in your seed round,” advised Judith.
“If you speak to 10 investors, that won’t cut it. You need to speak to dozens if not 30, 40, 50, 60 investors in your seed round.”
Learn the logic of the investor.
In the current era of personal branding, you don’t need a crystal ball to learn how an investor chooses their startups or how they think about a particular industry sector. Judith recommends that you use public information to your advantage.
“Oftentimes investors will publish LinkedIn articles about why they invested in companies. They will actually tell you a lot of the logic of their thinking. Surprise them by challenging their logic with your pitch.”
It’s all about storytelling
“I can’t hear ‘I’m the Airbnb or Uber of’ anymore,” Gülsah lamented. And honestly, can you blame her? So many startup founders use established companies as crutches to sell their story.
Consider dropping the buzzwords and the big names, and find your own unique voice instead.
In Gülsah’s words, “It’s all about storytelling. Think about your introduction. Try to be different. Talk about your industry set up, where you are positioned, and how you are unique.”
Don’t be needy
Funding talks can feel awkward, but it’s important to behave like you are worth the investment.
“Make the conversation at eye-level. The best calls that I have, I am intimidated by the founders. Own the executive aura,” Judith recommends.
“It’s always better to have crisp and short decks that leave time for questions, rather than risk running out of time.”
Leave time for questions
It’s tempting to cram in as much information as you can, but that leaves no time for the investor’s follow up questions — and the investor will definitely have follow up questions.
Make sure that you are leaving time for a conversation rather than winding up for a 30-minute monologue.
According to Gülsah, “It’s always better to have crisp and short decks that leave time for questions, rather than risk running out of time.”
At the end of the day, investors are simply people. A little healthy competition and #FOMO can go a long way, so don’t let your fundraising round stretch on forever.
“Fix a date in your calendar. Align the fundraising conversations in as close a timeline as possible,” says Judith.
Know the social code
How to successfully position yourself, negotiate and make connections is all really just social code. You simply need to know the rules.
The problem is that the rules aren’t often transparent. This is a problem for women especially.
From Judith’s perspective, “50% of business is knowledge and 50% social code. Women can capitalize on this as well, but it’s locked up in networks that are mainly male. You need to find ways to access the same information level (as men).”