Anyone in the angel funding business can tell you they get contacted and pitched non-stop – and it’s usually starts with some painful introductions coming from entrepreneurs trying to throw sales pitches at the angel investor instead of a well-written elevator pitch.
Start with Personal Introductions
The best way to contact any of your angel funding sources, or just about anyone for that matter, is through a personal introduction from someone you both know. Angel investors are people just like you, and like you they put a great deal of weight on introductions that come from people they already know and trust before they want an introduction from a total stranger.
You may not even realize that you have a mutual friend who could potentially make the introduction for you. But in the age of social networks, it would certainly behoove you to start there. There is some point at which the introduction doesn’t even hold up anymore. If you’re going to ask your uncle Louie to make an introduction to an angel investor who he met one night at a party three years ago, that might not be that helpful.
But if you can find someone who has worked with the angel investor in some meaningful capacity before, that is a much better way to get started. Angel Investors rely heavily on their social networks to find quality deals that come from trusted connections, so you’ll always be best off starting with those introductions.
If that Doesn’t Work, Send a Well-Written Introduction
Inevitably there will be some angel investors that you’ll want to contact that you don’t have any connection to. That’s fine, most people aren’t highly connected to Angel Investors.
Without the benefit of a warm introduction you’re still going in cold. But there are better and worse ways to make that introduction.
A well-written introduction to any of your angel funding sources will start by trying to make the first few sentences personal. Do a little homework on your customer. Find out what they have invested in before and where their interests might lie. You’re looking for a connection that shows “hey, I’ve spent some time thinking about you and I think this is where we might be a good fit for each other.”
You’re just looking for a basic connection for common ground, that’s all. You don’t need to overthink it, but also don’t overlook the importance of making the introduction personal.
Drop the Sales Pitch
We’ll often refer to the “elevator pitch” that explains what problem you solve, how you solve it well, and how big of a market that problem affects. That’s not the same as a sales pitch.
Here are the differences:
Sales Pitch: “We’re going to be the biggest site for anyone who watches movies!! This opportunity will be bigger than Facebook and is a sure thing!!”
Elevator Pitch: “We’re an online dvd rental business. We help consumers avoid the hassle of going to the video store to rent movies by delivering them to their mailbox for a monthly fee.” (Netflix.com)
Angel investors are smart people – they know how “big” an opportunity is when you explain what problem you solve and how you solve it well. They don’t need to be sold on the opportunity. They need to be convinced that the product is important.
The worst thing you can do is come across like a cheesy car salesman (no offense to honest, well-intentioned, straight talking car salesman). State what you do and the market size that you’re tackling. If that doesn’t explain it, you’ve got a problem with your elevator pitch, not your sales pitch.
Wait for Responses before Emailing more Angel Investors
The most important aspect of contacting potential angel funding sources isn’t sending out lots of emails – it’s the response you get from the first person you reach out to. Your elevator pitch is something you’ll want to iterate on lots of times, so before you send everyone a version that “can’t miss”, send it out to one or two investors and see how they react.
You could easily go through 10 revisions of your pitch before you find a version that investors react positively to. If you contact every one of your leads with the same pitch, you’re going to lose the chance to get it right.
What to Expect Back
Angel investors are busy like anyone else. If you don’t get any response from them within a week, it’s OK to send your pitch once more, preferably with a quick note at the beginning that reads “Jim, I sent you a copy of this on January 3rd, but wasn’t sure if you received it. If so, no problem, I’m just being thorough).” Not too many people are going to fault you for being “thorough”. Just don’t keep sending more emails after that. There’s a thin line between thorough and being a stalker.
The angel investor will most likely request more materials from you before they meet with you in person. Don’t worry about being coy and only “sending a teaser”. You’re more likely to strike out sending too little information than you are the right information they are asking for. In most cases an Executive Summary or Pitch Deck will suffice. No one has the time to read your 50 page business plan.