TBC: Investor Lists & Launching a Fundraise (HOW TO)

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Hey there. Welcome to another episode of the back channel. In today's episode, I want to talk about a very important part of fundraising that a lot of founders avoid and that's building your target investor list. So, first of all, why do so many founders avoid this work? When I say avoid this work?

Jason Yeh: I mean, when I give the directive that people need to have a really large investor list, You end up seeing people do much less work. And why is that? Well, first of all, it turns out as you start jumping into the work, you find out that this project takes a lot of time. Finding the right investors, figuring out how do you get to them?

It can be. So time-consuming and on top of that, it's not [00:01:00] exciting work it's brain damage. It's kind of like clicking through and doing a lot of research, putting it into lists, plugging information into tracking. Uh, systems. And all of that just feels like a waste of time when you are also in charge of. Running your business, recruiting new talent, finding new partners and selling new customers. So thinking about this work is the last thing you want to do.

And the last thing I'd say is on top of it being very time-consuming, it can be a bit confusing to know exactly what you should do. To find the right investors to reach out to them and run the process.

So it's not crazy to hear that a lot of founders avoid this. I want to spend a little bit of time, at least outlining some of the major steps that you should go through. To build your investor list. And then we'll talk a little bit more about some of the details that go into each of these steps. Okay. So, first of all, you need to go research [00:02:00] which investors to go after.

And when I give people this directive, I usually tell people there are two categories of research you should do. There's one, I call top-down research and then there's another called bottoms up. Top-down is more targeting Wales specific investors that you've heard of people that are on your dream list of investors.

And if I could pitch Reed Hoffman from Graylock How would I get to him? That's top-down research. Top-down starts with the figurehead investor that you go after and then figuring out how you get to that person. Bottoms up. Which I always tell founders is the. Category of research that founders don't spend enough time in is starting with your own community of connections.

And then figuring out who can get me to which investors. This is a coordinated effort to go through your own LinkedIn of network to figure out which investors are secondary connections of yours. It also is looking at your, your. [00:03:00] Your core group of supporters and potentially reaching out to them and mass and saying which investors can you guys get me to?

It might also be using your existing investor list or supporters and sending them a signup sheet to say, can you get me to any of these investors that I found from my top down research process? So there's a bunch of work that goes into doing that initial research. Once you figure all these things, remember you need to be mapping how you get to them. Mapping how you get them could be just, Ooh, can Jason introduced me to Reid Hoffman?

That's a very simple research project. But it might be a more longer-term thing where I want to get to the co-founder of. GoDaddy who is an amazing possibility of an angel investor. I'm not directly connected to that person. I'm not even second degree connected to them. But are there steps that I can take to get closer to his network and possibly get an introduction there that's a [00:04:00] lot of the mapping work. And as you're thinking about all these things, I want you to give yourself. A big goal.

A hundred targeted investors with a strategy and a mapped plan on how you're going to get to them. A hundred takes a long time. So my encouragement for you would be to break that work into bite sized chunks. If you try to do it all at once, you'll get way too discouraged to go through the work.

So instead. Do it a little by little 10 at a time, 10 at a time, carve out time in your calendar to do so. Okay. Once you have all that stuff. That's the research part of getting to a target investor list. Now what's the communication part. Remember, there are a bunch of emails that you're going to have to write. In order to get to these investors. Maybe they're cold emails directly to those investors, but I would encourage you to actually start with warm introductions.

So you're going to have to write the emails to your connections, to see if they will make the introductions to you. Then, once you have that in your back [00:05:00] pocket, you're going to have to have affordable email that makes it easy for them to make the introduction. Make sure you map out all the emails that you're going to have to write. And write them ahead of time.

This will save tons of energy and brain damage. Batching the writing process ahead of time. It's a little hack that I always tell people to do.

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Jason Yeh: [00:06:00] All right. And then once you figure out all the steps that you're needing to take to write these initial emails, When big encouragement I'd have for you, is that be prepared to follow up? So many of these emails will get lost in a busy person's inbox. You will need to follow up with them to get a lot of output from either introduction requests. Or direct emails to investors.

All right. Then from there, make sure you understand how to [00:07:00] get these intros sent out. Start coordinating your efforts so you can get to what I like to call calendar density, your or an initial set of meetings in a two to three week period. And then go from there. Last thing I'd say is I've already detailed, so many data points, so many communications, so many steps along the process. Hopefully it's obvious to you now that you're going to have to have a system.

So a system in place is going to be key. Figure out some kind of CRM system to organize this fundraise. If not, you will get lost. You will lose the energy. You will lose the momentum of a fundraise, which is essential. So figure out the system that you put into place. People always ask me what CRM system should you use? And I say. It's whatever system that you will use.

So figure out what's comfortable for you. Pick a solution and go with it. So that was a lot that was all off the dome. How I think about processes. It might [00:08:00] already sound like a lot and it is. So there are a couple of things that you need to know as you start thinking about implementing this, it's going to be hard to do on your own. In order to address that, make sure you do a few things.

One is to potentially have an accountability, buddy. Find someone, either internal to your team, maybe your co-founder maybe in an advisor. Who will check in with you around progress. It's kind of like having a sales manager, checking with you on a weekly basis to make sure you're doing the work and getting through leads. You might also be able to find a community of founders, maybe a buddy within the ecosystem, who's going through something similar and you can hold each other accountable.

That's also a great option. When it comes to the work of setting up the fundraise. The writing of emails. The research, the going through networks. You won't be able to be fully cut out of this process because it's your network. It's your words. It's your company. And somebody [00:09:00] is going to have to do it. But you could find help.

So if you have a junior person on your team who can be trained around some of the steps that you're taking to do research. I'd highly recommend that. If you want to think about hiring an EA who can be trained and you can tell what steps to take, to go through networks, to click through LinkedIn's to add information in the CRM systems.

I'd also highly recommend you think about that. I'll also give a small nod to a service that we've been developing out called adamant launch, where our trained team will take over all these initial tasks for you and do it to the best of our abilities.

But either way, this work is going to have to get done. There are a lot of different ways you can get support around it. Uh, but just make sure you plan out that support because this stuff takes time. I always tell people somebody is going to have to do the work. There is no shortcut for that.

So that's it.

That is my quick and dirty outline of what it takes to build an [00:10:00] investor list and to activate that investor list to start a fundraise.

It's a big task, but I know if you put your mind to it, you can get this done. I've seen it happen hundreds of times. From founders around the world. So good luck. Thanks for joining me on this episode of the back channel.

If you didn't already know, I run an in-depth program and private community designed to support founders, getting ready to fundraise. We have detailed training materials and live sessions. Where we cover topics like these all the time. If you feel like you're a bit in the dark when it comes to talking to VCs or like you're isolated and completely alone, getting ready to fundraise. You're not the only one.

And it's why I built adamant fundraising. Join me and hundreds of other like-minded founders at adamantfundraising.com. Membership runs via waitlist and is invite only.

but if you use the code funded to sign up, we'll add you to our priority list for listeners in the pod. Hope to see you there.

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