By Karen Deyo, Director of Investor Research, Israel BD, LSN
Life Science Nation (LSN) is well-known for teaching startup founders how to identify fit, reach out, and follow up with early-stage investors, but a prominent issue remaining is this: What happens when the message is clear, the materials are strong, the fit is promising, but you cannot get a response? What happens when an investor ghosts you?
Let’s go back to the beginning: No outreach campaign should consist of just one message. When working with our clients, we always recommend crafting a four-part outreach plan. The first message, which should be your elevator pitch, should be followed by several other messages, each highlighting a different part of the company that makes you unique. Whether this is the management team, a KOL in your advisory board, a strategic partnership that will help your technology enter the market – the messages will depend on what makes your company unique. Make sure to wait a decent interval between your outreach attempts, as you do not want the investors to feel that you are overloading them with messages. Also, do not take the lack of response personally. Many investors liken their inboxes to ‘drinking out of a firehose’ with the sheer number of inbound messages they receive from startups, and they may have just missed the first message.
If you find yourself consistently getting either no or negative feedback, you may need to adjust your messaging. A service, like LSN’s Branding and Messaging, can help craft a message that will resonate. You may also have connections with investors who can help identify what should be adjusted for a better response. One company at a past RESI crafted multiple messages and tried them all just to see which got him the best result. Once he saw which message garnered the most attention, he went forward with that for the rest of his outreach and ended up with an extremely successful conference, with many connections made. When fundraising outside the context of a conference, we recommend waiting with your top-tier targets, specifically to allow you to adjust your messaging to improve the response.
Another way companies can make themselves stand out is by putting in the effort to customize their messages for the investor. Say why you think it is a good fit for them, based on their investment criteria, or mention a specific portfolio company that made you think you would be a good fit for them. Investors can tell when you exert special effort to catch their attention specifically, and that can make them pay more attention to you in turn. While this makes the outreach stage a lot more labor-intensive, the outcome can be worth the effort.
Lastly, be creative in your outreach strategy. Doing an email campaign or requesting a meeting at a partnering conference are obvious choices, but in addition to these, you can find alternative paths to an initial meeting. Social media platforms like LinkedIn can be extremely useful for this – Look for the investor you are trying to reach and see if any unexpected connections pop up that you can utilize to make an introduction. If, when looking through the investor’s portfolio companies, you find one that you know, they may be willing to connect you, as well. Business connections do not always start through an introduction by someone you know extremely well, sometimes an acquaintance will make the connection that matters most – So keep your mind open and keep trying until you succeed!
While these tips can help limit the chance of having messages missed or ignored by investors, there is no fool-proof way to ensure that does not happen to you. It is an inevitability that some messages may go unread or unanswered, even from an investor who seemed initially interested. In this case, your best course of action is to follow the outreach plan outlined above. Trying to understand why or reading into a crystal ball may not be the best use of your time. It is an unfortunate part of the process, which is why fundraising is a numbers game and you increase your odds with every message. Remember that it is not personal, and so long as you are crafting a compelling message with a strong story to the right people, you are heading in the right direction.
Want to learn more? Join us at a free bootcamp: Strategies for Successful Partnering on Tuesday, March 8 at 12PM EST. This bootcamp covers tactical fundraising skills for early-stage companies on how to build a target investor list to prepare investor meetings. Sign up today and learn more about LSN partnering events like Digital RESI, March 22-24. Early bird registration rates end Friday, February 18.
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