Our experience of networking on LinkedIn was positive. Thanks to the social network, we met our first advisor — a consultant. It was a cold contact that quickly converted into effective cooperation.
Overall, LinkedIn has a good conversion rate — both large funds and top investors respond to emails. And although this does not bring immediate investments, it does provide a lot of motivation and desire to continue, which are so important at the initial stage. We divide the entire process of communicating with investors on LinkedIn into three stages:
- search,
- acquaintance,
- communication support.
Search: TechCrunch and CrunchBase
Create an account on LinkedIn and immediately select English as the main language, because you will not be able to change it later. Fill out your profile: name, photo, company name, field of activity, and also tell about yourself and your previous experience.
Investors care about a person's background because they often invest not in an idea, but in a team whose success they believe in. So take your profile seriously - sometimes it is based on it that they will decide whether to respond to your messages or not.
Marina Mogilko's LinkedIn profile, co-founder of LinguaTrip.com, from which we wrote to investors. Marina's account is more advanced, so, as we assumed, the conversion from her page was higher
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After creating a profile, you can search for investors directly on LinkedIn. To do this, enter a keyword in the search bar, for example, "investor" and select the "people" category. You can narrow your search by geography, company, and other parameters. The social network will show a list of contacts and how you are connected to them: directly, through mutual friends, or not connected at all. It is better to have mutual friends, because LinkedIn imposes restrictions on sending messages to people with whom you have no common history.
This is the easiest way to find an investor, but we did it differently. We looked for the right people through the media, and for this we read news in TechCrunch, Business Insider, Rusbase, vc.ru and similar publications. The main goal was to find similar startups , but not direct competitors, but companies from related areas.
LinguaTrip.com works at the intersection of education and travel, so we were interested in startups in the field of education or tourism. Then we went to the sites crunchbase.com and angel.co to find out who, how much and at what stage invested in them. This way you can find out the name of the investor or the name of the fund, and from the profile take their contacts, including on LinkedIn.
Getting to know each other: introduction and highlights
After compiling a list of investors, we look on LinkedIn to see if we have any mutual acquaintances. Of course, nothing prevents you from writing to people directly, but it is better to find those who can make an introduction - officially introduce you to the investor. It is great if this is a founder with whom the investor already works and whose opinion he trusts. Then such an acquaintance will add weight to you.
You can build a whole strategy on this - first establish positive contacts with the startups you are supporting, and then ask them to introduce you to an investor. However, this is a long story, and if you need it faster, write directly, especially to large funds. They have a high open rate - they respond to almost all messages.
Before the first contact, prepare information about the project - revenue, its growth by month, expenses, user growth, etc. Investors do not waste time studying multi-page documents, they need a summary with the main points. Make the letter as brief as possible - literally three sentences:
- What is the name of the company and what does it do?
- Key metrics and highlights.
- Why did you choose this particular direction?
At the end, add a phrase like this: “I see that you invest in projects in our field. Could you give me some feedback on my startup? I would be very grateful if you could find 15 minutes for a call this month.”
In the US, it is not customary to talk about investments right away, so it is better to first ask to evaluate the startup or recommend people for cooperation. If the investor likes your project, he himself will offer to meet to discuss it.
Cold letter to investor
It is also necessary to show that this is a personal message, not a mass mailing. To do this, find out more about the investor - what he does, who else he invests in, what is going on with him in general. This will help make the letter personalized.
For example, you can congratulate an investor on a deal they just closed. If you're writing to a founder, rate their product — say that you liked the latest feature, but you found a couple of bugs. This way, people will understand that you're monitoring their activities and are addressing them specifically.
Pay attention to literacy — be sure to check for errors and use expressions accepted in business etiquette. Texts can be automatically checked in the Grammarly service — a Chrome browser extension. But it is better to give important letters to native speakers for proofreading. The fluent.express service employs professional English-language editors and proofreaders who will bring the text to perfection.
Be sure to respond to emails and messages the same day you receive them. If you wait more than a day to respond, investors may refuse to communicate further because they will not consider you particularly interested. Looking ahead, I will say that you should also promptly confirm meetings, agree to early breakfasts, and arrive early.
It is also important to understand whether the investor is ready to invest in you at all. In the US, it is not customary to criticize or refuse people. Usually, letters come with enthusiastic comments, advice, and recommendations. At first, we perceived them as a sign that we found investors, but in fact, they mean "no".
If an investor is interested, he usually asks for additional information about the company. And when the investor is ready, he says so in plain text.
Keep in touch: congratulations and updates
Even if cooperation does not work out right away, this is not a reason to stop communicating. Investors usually "leave the door open" and are ready to resume negotiations if the project shows serious growth. The main thing here is not to lose contact, so save all the information.
You can use CRM for this, but we simply enter the data into an Excel spreadsheet. It has four columns: the investor and his contacts, the person who can introduce, the date of the last communication, and the date of the next follow-up.
You also need to remind them about yourself periodically. Birthday and holiday greetings are good for this, as well as an update mailing with news and updates on the project.
I recommend sending them no more than once a quarter, so as not to bother with letters. In the update, report on the startup's achievements, provide new metrics, talk about the difficulties you encountered and how you overcome them. It is advisable to fit all the information into 4-5 sentences.