AngelList is an online community that matches startups with investors to streamline the fundraising process.
I do know a person who raised $1 million from AngelList for his startup, and had helped dozens of other startups raise $3 million more. I’ve referred more than 20 startups to AngelList, vouched for a dozen other investors.
Try a similar strategy by adhering to the following steps.
Naval and Nivi, the founders of AngelList, took the very best social mechanics from Facebook, Twitter andLinkedIn to create a “social proof” that ultimately makes investors comfortable writing checks.
Include numbers. Don’t say “100K,” say “100,000.” If you can name drop big customers, do that too — you want your profile to look impressive.
Focus on traction. How many customers have signed up to your service? How many have been active in the past 30 days? What is your viral coefficient?
Include screenshots of your product, a video walk-through and one or two charts that display traction or revenue. If you have a good video pitch, include that too.
Don’t focus on press. Nobody cares that you got covered in TechCrunch, or that The New York Times blog picked up your press release.
Be careful when listing an investor as an advisor. Most other investors will immediately wonder, “Why didn’t he invest?”
Ask all of the investors you already know to click and request an intro. A good target is to get up to 10 introductions. People are happy to do this — but you have to take the initiative first.
Ask investors and advisers you trust to leave a positive comment. I would focus on comments from investors, not necessarily other entrepreneurs. A good target is three comments.
Do not create fake intros. People will notice, and it will reflect poorly on you.
You want investors to go to the AngelList profile instead of passing around your clunky PDF. The AngelList profile never gets stale because you’re able to constantly update the different fields, and your profile will update as new investors come on.
You want investors to go to your AngelList profile because it increases the likelihood that they will interact with it – they can follow you, add an intro or leave a comment. All of these actions increase counters that mark your profile as a hot or trending company. Bottom line, if you’re talking to investors, you want to “get credit for it” on your AngelList profile.
When you’re done fundraising, you have the option to “turn off” your profile. Most people won’t have saved their own copy. If you really want to be tight-lipped, lock down most of your profile and choose individuals to share with. Then, even if someone leaks your link, most information won’t display to others.
Ready a form letter to personalize and send. Don’t make it sound like a form letter, however, but have your reply and supporting documents ready to go.
I use a service like Tout to manage my email templates for quickly replies. Here are some valuable templatesyou can use.
Many angel investors will be significantly more comfortable if they know another respected investor has blessed the deal. Also, most leads will have their own network of co-investors with whom they can share the deal, but make sure to ask that they share on AngelList too.
I’ve seen successful blasting work fine for more than one startup, but the best way to stack all the cards in your favor is to line up the lead first.
Start by searching AngelList by market and geography. For example, search for investors who are interested in mobile and also are willing to invest in Austin, Texas. You’ll find 590 of them!
Also, request an intro with anyone who follows your investors, advisors or referrer.
If you don’t see the “request an intro” button for someone, ask investors you know to “share” the deal with them. It’s always best to meet someone through a trusted, third party.
As a last resort, reach out to them elsewhere. Try LinkedIn, Facebook or Twitter. When you make contact,send them a link to your AngelList profile early on in the conversation.
The hottest and best startups get pushed out to all of the AngelList investors by the team that runs AngelList. The best way to get their attention is to follow the other steps I outline above. They will notice when your startup starts “trending,” gaining introductions and comments.
Think of this as your investor communication. Update your status with Twitter-like short messages to announce progress. Also, update after raising money (like you would keep LinkedIn current, even when you’re not searching for a job). That way, when you’re looking to raise another round, your AngelList profile is ready to go with all of the social proof built in from your previous round.