TLDR

  • Cold inbound is another important tool in your arsenal when it comes to fundraising efforts and shouldn't be disregarded.
  • There are a few things you can do to maximise your chances of getting a response from cold inbound.

Warm introductions are often seen to be the only way to connect with investors but the fact is many investors are open to cold inbound and consider it a crucial part of accessibility within the ecosystem that strengthens their deal flow.

It remains the case that despite the stigma attached to it, most VCs affirm cold deal flow as important and lots of well known companies have succeeded in gaining funding by sending out cold emails.

Whilst many investors do not respond to cold inbound as much as founders would like, and there is no guarantee cold outreach will result in a response, there are a variety of things you can do to ensure your messages are received well and your chances of success in obtaining a response are greater.

  1. Do your research and homework - One of the main reasons startups don’t receive a reply from investors is that they don’t fit within the investor’s portfolio interests. Therefore, make sure the investor you are reaching out to is not only a good fit for your startup but that your startup is a good fit for their portfolio. Do they typically invest in your sector or take part in rounds that you are raising for? Figure out who specifically you are going to email by determining who you think the person most relevant and accessible is for you to contact.
  2. Short & sweet is the aim of the game - Though many think cold outreach won’t amount to much, it doesn’t stop investors receiving thousands of emails from prospective startups every month. They do not have time, nor the desire, to read a blog post about why they should invest in your startup. 50-200 words about your startup and why you think there is a fit will be sufficient.
  3. Personalise - NEVER cc or bcc multiple emails. Mass emailing is a waste of time. Make sure you keep the message personal to maximise responses.
  4. Get to the point - You should quickly describe your startup, what makes it different and worthy of a meeting. Pique the investor's interest. Use metrics or existing relationships with well known investors or publications.

At the end of the day, cold outreach is simply one of the many tools that should be in your arsenal to help you achieve your goal of fundraising and it should not be disregarded.

First, I would recommend keeping the message simple. Most VCs get 10+ inbound a day and a sure-fire way to losing the VC's interest is to send a super-long and unstructured email. The key here is to provide enough info to pique their interest - don't overload! I would suggest a very simple structure along the lines of:

  1. Personal message (always direct the email to someone's first name!) — Take the time to understand who exactly you are reaching out to. Why in particular is this interesting to them? Have they backed a company with a similar model in another space? Are they particularly interested in that sector? Have they written an article or a thread on twitter talking about this exact problem? Remember to keep this short though (no more than 2 sentences).
  2. One line on what the company does.
  3. One line on why your team is the right team (demonstrate founder-market fit).
  4. 3-4 bullets on traction (revenue, any commercial validation, or any press).
  5. One line on how much you are raising and any commitments (particularly if a co-investor that we have invested before). For us it's also helpful to know if you are S/EIS qualifying as well.
  6. I may be in the minority here but I love a Calendly link to book something quickly without having to revert back and forth.
  7. Attach your deck, Docsends are great for the founders, but pdfs are preferred for our dealflow database and sharing internally.”

Good clean cold email is better than a not-so-good introduction. Here is how to nail it.

  1. Make it short – max 3 paragraphs
  2. Grab our attention with the key fact about yourself first.
  3. State who you are and why you are relevant.
  4. Tell us what you are working on.
  5. Hint how we can help (as in how SMOK and our partners can help).
  6. End with a call to action
  7. Attach a deck in PDF (see next point)
  8. Again, make it short!!

We're always open to cold intros. We recommend, of course, that you do some research before and try to understand our scope and focus, as we would when reaching out cold to a founder.

If you’ve spotted any inaccuracies in this post, please let us know. We want to make sure we are offering the most update to date and accurate information. Feedback is always welcome.