What are the deadly investor prospecting mistakes you might be making while trying to raise funding for your startup?
Knowing what you should be doing is half the battle. Just make sure you are alert to the mistakes you shouldn’t be making as well. That’s where things will really line up, and you can go from frustration to getting funded.
If you aren’t getting the response you hoped for with this fundraising round, or you just want to make sure your next round is efficient and successful avoid these blunders.
Your Pitch Deck Is Too Long
How long is your pitch deck? Early-stage, pre-revenue startups only really need 10 slides in their decks. If your startup is a little more mature you may have 12 to 16 slides.
Later stage startups may be able to justify 20 slides if they have a lot of existing financials and complex structures after acquisitions, and have a developed menu of products in different verticals. If you are exceeding these numbers there is a high chance your deck is sabotaging you.
Weak Email Subject Lines
If your pitch deck isn’t even being opened and viewed, and you are cold pitching via email, then it could be your subject lines or cover messages that are the hurdle to your success in fundraising. Make sure to avoid the deadly investor prospecting mistakes you might be making.
Firstly, you have to make sure that your emails aren’t just being filtered as spam, and aren’t even making it through. Then be sure you’ve got some professional copy and marketing help, and even split test these other factors to increase your odds of getting your deck opened by investors.
Keep in mind that in fundraising storytelling is everything. In this regard for a winning pitch deck to help you here, take a look at the template created by Silicon Valley legend, Peter Thiel (see it here) that I recently covered. Thiel was the first angel investor in Facebook with a $500K check that turned into more than $1 billion in cash.
Remember to unlock the pitch deck template that is being used by founders around the world to raise millions below.
Poor Form Email Addresses
Even the email address you are sending from could be an issue. Does it look unprofessional and spammy? Hopefully, you’re not using a cringeworthy Hotmail address.
We get too much spam and junk these days. The first assumption is always that an unexpected email is spam and shouldn’t even be opened. Don’t let that be your fate.
Email Attachments Are Too Big
You may have a beautifully designed pitch deck and all of the supporting materials to really convince investors you have it together. Yet, files that are too large can fail to get through, fail to load, or are just too slow to load.
Time is precious and people are impatient. Send links to your deck and data room hosted online instead of as attachments. This also gives you more options for sending. You can use social media, text messages, signal messenger, and so on.
Links Are Wrong Or Broken
This is such a common issue. Yet, few people may take the time to tell you. Be sure you test your messages and links every time before sending.
Not Polishing Your Online Reputation
The vast majority of people check everything out online before they even consider buying or responding and engaging in a conversation.
If people take the time to check out online reviews before ordering a coffee, lunch, or clothes, you can bet they are going to look you up too.
This isn’t just about cleaning up any digital dirt you may have laying around. It is about shining and showing up well. The first impression should be that this entrepreneur is extremely well qualified and serious. Not that you just hopped onto this idea yesterday after several other miserably failed startup attempts.
Expect them to look you up on social media, LinkedIn, your website bios, Crunchbase, and more. Be proactive about this and publish new content in advance of prospecting. Not addressing your social media presence is one of the deadly investor prospecting mistakes you might be making.
Not Doing Enough
Even the most successful startup founders who have raised the most money and have built billion-dollar companies, or more than one venture, have shared on the Dealmakers Podcast that they have had to pitch as many as 300 investors.
That’s not emails sent, Tweets or calls made. That’s actually pitching live to investors and getting a no. Sometimes even after multiple conversations and meetings.
This is a numbers game. Have the mindset that you need to be prospecting at this level, to get that many meetings, in order to get a few wires in the bank.
Just sending out your message once isn’t enough either. Just like any other type of sale you may have to get in front of them seven to 11 times. Both upfront and in follow up after your initial pitch.
If you’re looking for more detailed information about the most deadly signs of a bad pitch deck, check out this video I have put together.
Pitching The Wrong Investors
You can greatly improve your speed, efficiency, and conversion rates by being targeted in your investor prospecting. Make sure you know the criteria for your best fitting investors, have researched them, and tailor your pitches to them. This will not only save an enormous amount of time and energy but will make the fundraising process a whole lot more tolerable too.
Taking The Long Route
There are great headline news stories about a few entrepreneurs who have landed funding from celebrity investors with cold emails and Tweets. These are the exceptions and shouldn’t be your expectation.
Cold prospecting can work and may need to be a part of your strategy. Yet, it clearly takes a lot more time in general than if you have warm connections. If time is important to you (and it always is), then consider how you can hack this situation by leveraging consultants and advisors with the right connections for warm introductions to the investors you really want to raise from, and who want to fund ventures like yours.
Do your best to avoid these deadly investor prospecting mistakes you might be making, and maximize your chances of getting the funding you need.
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