Blog Post

How to 'get across the moat' with potential investors

Editor’s Note: Following up on yesterday’s topic, I’m putting together a post on how to amend your business plan with a “global scope,” as well as how to find angel investors who can support you in this important strategy.

Meanwhile, I went to angel investor Guy Kawasaki’s blog this morning, and found a fantastic post entitled How to get the Attention of a Venture Capitalist. It’s got some of the best tips I’ve read for how to get that all-important, and so difficult, first look from a potential investor. The same advice can apply to attracting an angel investor, too. Do read Guy’s complete post, below are the highlights. Pay special attention to the PowerTip and list of Things NOT To Do at the end.

1. Get an introduction by a partner-level lawyer… at a firm that does a lot of venture capital financings…

2. Get an introduction by a professor of engineering. … this is even better than the lawyer’s call if the school has a history of receiving multi-million dollar donations from its alumni…

3. Get an introduction from a founder in the VC’s portfolio. … this would be a good time to tap your network in LinkedIn …

Here’s a power tip regarding getting to venture capitalists using LinkedIn. Maybe it’s only me, but I hate when a connection of a connection of a connection wants me to take a look at deal. LinkedIn enables you to just go direct…

4. Show success. … if you can’t get any of the introductions mentioned above, the most compelling email/voicemail you provide is this: “My buddy and I have been working in our garage, taking no pay, and … we built a site that is doubling in traffic every month…we’re at 250,000 page views a day…”

5. Make sure your company is in the right space. …if you have the cure for cancer, contacting a firm’s enterprise software guru isn’t the brightest idea…

6. Use a short email. The ideal length is three or fourth paragraphs:
* What does your company do?
* What problem are you solving?
* What’s special about your technology/marketing/expertise/connections?
* Who are you?

and…then Guy offers 6 Really Important Things NOT to do:
1. Attach a PowerPoint presentation. I don’t care if it even adheres to the 10/20/30 rule. Save it for the face-to-face meeting.
2. Use the word “patented” more than once.
3. Claim that you’re in a multi-billion dollar market.
4. Provide a lofty financial projection.
5. Brag about an MBA degree.
6. Claim that “Sequoia is interested.” … don’t even think of blowing this smoke.