Hello, everyone. This is Alejandro Cremades, and today we’re going to be talking about
how to cold email investors. Obviously, cold emailing investors is not the best way to
get into the circle of trust of the investors because those investors are going to expect
you to have a warm introduction to get in front of them.
Here’s the thing: in many instances, cold emailing those investors can actually yield
great results. There are many, many investors out there, like Mark Cuban, that are very
well known for investing in companies that have emailed them cold without any type of
preexisting relationship and that they actually took into a meeting, and they end up investing.
In the video today, we’re going to cover what some of the things are that you can do
to cold email investors and to optimize your chances toward getting a potential investment
from them. With that being said, let’s get into it.
Chasing the right investors is critical because when you’re fundraising, you’re ultimately
optimizing for time. What optimizing for time essentially is, is going after investors that
are going to be more likely and more inclined to make an investment in your business.
What this means is, you want to go out for people that are investing in your segment,
investors that are also investing in your geographic location, investors that also are
essentially investing in your financing cycle. If you’re too early and they’re investing
on a later stage, there’s not going to be a fit. So, you want to go after those people
that are inclined. The same thing as when I was talking about segment, if you’re in
healthcare operating, you’re not going to go to investors that are investing in fintech.
It makes no sense. They’re going to tell you no.
Then the other thing is that you want to go for people that are going to be a good fit
that maybe have the same principles, maybe they’re seeing the market in the same way
that you’re seeing it, and those are the people that you want to go after, and you’re
going to have more chances for them to make an investment on you. So, remember always
that optimizing for time is the way to go, and when you’re looking to put together
a list of investors, you want to put into that list people that are basically into what
you’re doing and that have an investment thesis around your type of opportunity.
There are different ways at getting emails for investors. A really cool tool that I like
is called hunter.io. What this website does is that you put the URL of the individual
that you’re trying to target that works at the company or at that firm, and hunter.io
is going to give you the exact name and the last name and whatever that email structure
is so that you can copy and put it in your email with whatever body language that you’re
putting. That’s a really good tool. Other methods of getting emails from those
investors are some of the following: Purchasing or renting email lists
Having an assistant scrape email data from the web
Finding investors on popular startup and investing platforms
Referrals Listening to podcasts like DealMakers
Through schools and universities that they may lecture as professors
Through angel groups and associations When it comes to the email itself or the body
or the language that you’re going to be using in that email, everything is going to
start with the subject line because the subject line needs to be a subject line that they’re
going to be inclined to read. A subject line that performs 60% or more on the open rate
is follow-up, and follow-up regarding whatever that is.
What you do is, you go into the email and in that first paragraph, what you do is you
insert the keyword “follow-up” that you’re following-up after hearing about them, reading
an article, or someone told you about them, and that addresses right away the fact that
you’re using the follow-up on the subject line. Otherwise, they might get annoyed. The
way that you’re structuring those emails, they need to get to the point. They need to
be very simple, and they need to be compressed. You can’t put a super-long email because
you’re going to lose people. The attention span is very low.
When it comes to the body, you want to use two to three paragraphs maximum, and you always
finish it with a call to action. First, you’re going to open up with “Hi, name.” Then
you’re going to go into, “I wanted to reach out because after learning about your
story, blah, blah…” and that’s the first paragraph.
Then, in the second paragraph, it’s all about who you are. You can go into providing
some background. “I am the co-founder of XYZ. We are a team of – we are targeting
this market, which is super exciting because there are so many billions, and this is why
we are qualified to be the best team to execute this.” You’ve got to be straight to the
point. Then, the way that you want to finish it is
that every email, every interaction with an investor, always needs to finish with a call
to action. The way that you could finish the email is, “Are you available for an introductory
call next week or the following? Best, your name.”
That is straight to the point. You are addressing why you are reaching out. Then you are exactly
introducing yourself in a very powerful way, and then you are closing the email with perhaps
that call to action to get them on the phone to really get to know each other.
When you’re actually in front of investors, you’re actually trying to speak to them,
get in front of them, and really create that excitement, there are different angles that
you can use to your advantage in order to push things forward. Some of those angles
are the following: Asking for advice
Surveying them on their business, investment theses, or what they’re passionate about
Making a claim that gets them interested Fear of missing out
Referring them to content recently published about you or a big achievement that you did
Also, including your pitch deck You also want to make sure that they feel
that you’ve done your homework. You need to go into their LinkedIn page to see what
groups they follow. Go on their Twitter account so that you see what they’re tweeting about,
and you get a good idea of what excites them. Those are going to be some of the great things
that even though you may be reaching out cold, they can see that you’ve done your homework
on them. When you’re cold-emailing the investor,
all you want to do is get them into the funnel. Basically, fundraising is just like a sales
funnel. Essentially, that first cold email is going to lead to an introductory call.
Once that introductory call happens, then there are going to be some materials that
are exchanged. After those materials are exchanged, what’s going to happen is that you may meet
them in person, or they may bring another partner on their firm or someone else that
they trust to take a look at the deal, to meet you, and things like that.
Once that first in-person meeting happens, then you go into what I call the follow-up
game. You’re telling them right now that you’re here, and then over the course of
time, they need to see that you’re executing and that those dots are connecting. Every
couple of weeks, you’re going to be reaching out with a follow-up email telling them the
great feedback that they gave you and how you’ve been implementing it, and also, perhaps
milestones that you’re achieving, or press mentions, or things of that nature that are
really exciting to them. Eventually, one of those investors that you’ve
been engaging with are going to be stepping forward, and they’re going to be like, “Hey,
by the way. Are you looking for a lead investor?” because always remember that you’re going
for advice. As the saying goes, “You go for money; you get advice. You go for advice;
you get money twice.” So always go for advice. When you’re engaging in like 50 of those
investors, and then one of them says, “Are you looking for money?” At that point, you
strike, and you say, “It would be such an honor to have someone like you leading a round.”
What happens is that if that investor sees that investor already introduced it indirectly,
like, “Hey, do you need money?” Then, most likely, they’re going to come in. They’re
going to become the lead investor, give you 20% or more on your financing round, and then
what you do is you go to the other 49 investors that you’ve been engaging, and you tell
them, “By the way, something great happened. We had this incredible investor that came
in to lead, and I would love to share this journey with you as well. We’re closing
by x-date,” so you’re already putting in there the fear of missing out, “and I
would love to send you the offering documents. Would it be okay if I send you those documents?
We’re closing again on x-date,” so that you get that sense of urgency. So, what happens
is that you’ve created that storm. You created that fear of missing out, and then people
are going to be thrilled to really jump in and share that journey with you.
We love to hear on the comment section below what the things are that you’ve done to
cold email people, like out of the blue and how they reacted. Like this video, as well,
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much for watching.