Have you been on the other end of “How can I help?” from an investor and after taking them up on their offer… crickets?
Below are five tips on how to get investors to respond:
1. Ask a specific question.
When you’re just starting out you often don’t know the questions to ask so the tendency is to spill your guts all over email hoping that the person on the other end will distill your history and give you both the questions and the answers. The reason you’re not getting a response is because no one can do this for you. You probably need to be a little further along in your journey before talking to an investor. Investors aren’t a**holes, they are just busy. Wait until you’ve formed a question before reaching out.
2. Do your homework.
What do you know of this investor? What deals are in their portfolio, how long have they been involved in CPG and what did they do before they were an investor? Investors are human beings and recognizing them as an individual will help you hone in on relevant topics and questions.
3. Don’t just be seeking money.
If you sent your pitch deck cold and said you’d like to be considered for investment, don’t expect to hear back. Investors looking for deals are out there as attendees, panelists, or judges at pitch events and that is where you want to be. You can still send a personal email and say “Hey, I’m pitching at X, will you be there?” but don’t focus only on the money.
4. Don’t drone on about your product.
Founders tend to be too product focused. While there’s not a formula when talking to an investor, within the first 30 seconds you’ve got to describe the problem you are solving and how big of a problem it is. The product piece should not go into major detail – only as it relates to how it is different than the competition. And if your product is so weird there is no analogue, the more important your evidence of traction becomes so stop talking about the product!
5. Send regular updates.
Keeping investors informed of your progress is a good idea. Make an outline and keep it simple. You want to touch on these topics: revenues and revenue growth, new distribution, repeat customers (retention rate), any other milestone or hurdle (like manufacturing), gross margins, new branding or packaging, new team members, new advisors, or where you’ve been accepted for incubation. If you don’t want to do this yourself groups like AngelSpan provide investor relations and their team can keep you on a consistent communication schedule.
Attracting advisors and industry leaders
Whether you are ready to pitch to investors or not, it’s a good idea to seek guidance from advisors and build a community of industry champions. These are people that believe in you and what you’re doing, and who have a wide network to connect you to what you need.
It does take effort to build those relationships but most of us veterans in the industry are super open and accessible. Here are some tips on how to build and nurture your industry champion community:
- Follow them on social media.
- “Like” their content.
- You wouldn’t believe how much people notice who is reading and liking.
- Send a personal note not asking for anything
- Don’t be annoying, but if something specific they contributed was helpful to you, reach out and say thank you and expound on how it helped.
- Keep them informed through an email newsletter.
- Claire at Teffola does a wonderful job of this. Her emails are short, informative and upbeat, and I feel caught up on her brand.
- Send samples!
- Ahhh, I know it’s expensive but this is how you become memorable.
- Seek out the less-famous.
- Even though Mark Ramadan said to keep in touch there just might not be enough of him to go around.
What other communities should I be building?
Your avid consumer, of course. This is the core audience you direct all messaging toward and who will spread the word the loudest about your brand. This is your tribe. Make them feel special.
Additionally, build a community of peer and customer stakeholders. Other brands who share your same avid consumer are peers who you can count on for support. Customers that are pivotal to your brand’s success, such as retail buyers, are important relationships to cultivate. Buyers love to be included in new news about your brand before it’s set in stone so that they can offer input and feel connected to your success.
Jennifer Barney is an advisor and consultant to food and ag businesses at 3rd & Broadway. She previously founded the almond butter brand Barney Butter.
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