So I get the following email via AngelList the other day:
It’s great to meet you. As xxxx mentioned, we’re in the midst of a seed round that also includes xxxx. We have some awesome early traction: xxxx have downloaded xxxx since we launched in May and we’re seeing xxxx user retention. Our xxxx round is about half committed and is filling up.
Because of your interests in analytics and SaaS, we’d like to speak to you. Are you free to chat at one of the following times?
Tues Aug 7 @ 3:30p EST
Wed Aug 8 @ 11:30a EST
We can also accommodate your schedule. Your experience with xxxx is especially relevant to xxxx so we would love to connect before we close the round on August 30th.
This is not the worst introduction I have ever received by a long shot. On the surface, it seems respectful, concise, and detailed. In fact, most people would read it and wonder what the issue is. However, there are some very real problems that you need to be aware of and avoid if you are to make the most of your introductions whether via AngelList or other avenue.
- No Lead-In – Why is the person facilitating the introduction not adding their own thoughts? I want to know why you would think this introduction is worthwhile to me. When there is no explanation, I just assume you passed it along without any thought simply because it was a favor. That is one issue I have with AngelList; it is really easy to push intros out to your connections, but it is a bit too easy. Every intro should include some context and commentary from the introducing person. And for those folks doing introductions, think before you forward.
- What Is It – If someone has to hunt around to figure out what it is you do, then you are adding unnecessary obstacles. To be fair, when I reviewed the email later on, I noticed that scrolling down revealed the startup’s AngelList profile. However, I had to scroll down and if someone was reading on a mobile device, it is very easy to miss that salient information. Make life easier for the reader and tell them in the first sentence what you do and add a link to your website or AngelList profile.
- Pushy Timetables – Having a timetable to close a round is obviously a good thing. Funding can take a hell of a long time to round up the commitments and finalize the deal. However, if this is the first time we are talking and you are telling me you are closing your round in three weeks, I am not interested. Investors want to know you for a period of time, observe your milestones, vet the opportunity, and have the time to truly consider whether an investment makes sense. It recalls two great blog posts “Invest in Lines, Not Dots” by Mark Suster and “Speed Can Kill” by Roger Erhenberg about the problems with accelerated fund raising rounds and the importance of investing in relationships. Investors have their own timetables and pushing your deadlines into that is not going to foster a relationship. Instead, all it does is create conflict when you push your agenda. Investing is all about the relationship and that is something you need to keep in mind.
- Relevant Interest – So an interest in “analytics and SaaS” means that I have an interest in your product? Yes, those do interest me, but those are huge buckets and cover a whole lot of categories and markets. What would be better is doing a little digging and seeing if your targeted investor might have expressed something that would strongly connect your idea to his or her interests, instead of relying on broad constructs. If you do not make your venture relevant to your audience, you risk losing their interest pretty quickly. There are a million reasons for someone to say no, you need to make the case for an investor to take notice and say yes.
This is by no means meant to convey AngelList in a negative light. It has and continues to be an extraordinary platform for both entrepreneurs as well as investors. The reality is that money is a bit easier to come by and entrepreneurs have more leverage now than at any time in the past. However, just because things are easier does not mean that it is acceptable to skip steps or presume anything when it comes to fund raising. Being aggressive and driven is fine, just make sure you are not shooting yourself in the foot by sending thoughtless and off-putting introductions to investors.
I have written about this subject in the past, so if you need some tips, check out “How Not To Reach People”, “How Not To Get The Attention of Investors”, and “How To Reach Anyone”.