Taking the Last Step: Followup

By Dennis Ford, CEO, LSN

Following up with targets is one of the most essential aspects of the phone canvassing process. Fundraising is an extremely time-consuming and lengthy process. It’s easy to get caught up in a very good conversation and think that an investment is right around the corner. All you need to do is sign the dotted line, right?

While being optimistic about the fundraising process is certainly something you need to do to keep your sanity, you should not underestimate the time that it will take for you to complete this process. If you are lucky, you will get an investment in eight months (this is extremely rare). If you’re unlucky, you won’t see an investment for eighteen months… or perhaps you won’t ever see an allocation at all. However, you can greatly improve the odds of you getting an allocation if you embrace the marketing process.

The goal of finding an investor is not just to get cash; the end goal is to find a partner that can help you grow your business. The goal then that you should keep in mind for phone canvassing is that you are trying to establish a professional relationship with the investor. Even the investors that speak with you that are not a fit today may be a fit down the road – for instance, when you have more clinical trial data or you have a prototype of your device. You also never know whom that investor may know, so it’s always useful to keep a dialogue going.

How you follow up will depend largely upon your current relationship with the investor, their level of interest, and how you left off your last conversation. Below are some hypothetical situations, as well as some tips on how to handle your follow-up procedure. It is important that you establish a plan for follow up and stick to that plan. If you have a consistent plan, then it will help you to keep your prospects organized and keep the entire process streamlined and efficient.

One of the most important parts of the follow up process is to ensure that you have a fresh and up-to-date contact situation. Getting the correct contact details for an investor is important to do no matter what the situation is. You need to make sure you have the person’s correct name (this includes spelling) their title, direct phone line and e-mail address.

Now, for the hypothetical situations:

You speak with investor, and have a great conversation.

This is of course the ideal situation. If this happens, then a followup call should be scheduled. Depending on how well it went, you might even want to schedule a face-to-face meeting. You should not delay following up in any way, and rather, if you run into this kind of situation, it is best to set a date for follow up at the tail end of the conversation. Also, if you have not done so yet at the end of the call when you follow up you should also send your investor deck and any other supporting materials that may be interesting to a potential investor.

You speak with an investor who is interested, but doesn’t seem highly compelled.

Here is where it’s a good idea to ping them periodically to set up a date to touch base in the future. Make sure you find out a general time that is good to reach them, and coordinate a time to speak in the future. Also, you should try to see if they will be in your area at some point, or possibly attending any networking events or conferences where you will be; face-to-face meetings are always better than speaking over the phone, so meeting this investor in person could lead to mild interest becoming serious interest. This is why you should never pass up meeting an investor in person even if you believe they do not have a strong interest in investing.

You speak to an investor who seems to have little to no interest.

If this is the case, it is important to find out why, because it will determine whether or not it is necessary to maintain the relationship. Perhaps they’re not interested in your particular disease area or not familiar with the indication you are targeting. If this is the case, then it is probably not worthwhile to attempt prolong the dialogue. You should certainly make note of the points the investor found less compelling because you may learn some valuable information about how to approach investors in the future that have not necessarily invested in that disease area in the past. If this is the case, make a note not to spam this investor with follow up emails in the future.

Perhaps the investor does have an interest in your technology but you do not have enough clinical data for their liking. If that’s the situation, it is appropriate to follow up later down the line when you do have sufficient data. You should thus make sure to keep this investor on your list and e-mail them, highlighting the new positive data that you have collected.

Gauging the type of follow up that is appropriate will hinge upon the amount of interest an investor expresses and what your current relationship with the investor is. You need to stay extremely organized during this process and keep excruciatingly detailed notes. Don’t try to force an investor’s interest, and try to keep in mind that fit goes both ways. Try to allocate your time in an efficient way and spend the majority of your time keeping a dialogue with investors who are legitimate prospects.

In short, phone canvassing can be one of the most effective tools to reach out to investors – but only when executed properly. You need to remember to stay focused, train hard, and above all stay optimistic. Know that it is a numbers game, so the more investors you engage, the more success you will most likely have. At the end of the day, your perfect investor is out there, and it’s your job to find them, get your company funded, and continue to grow your business.