How to Build Investor Relationships & Raise Capital: Insights from Kevin Siskar

These people are going to work with you for a decade if they invest, and you're essentially going to get married. And so you want to make sure that you— at the event last week, Catherine at Buildstock basically was like, yeah, like, I vibe check all my investors. Like, if they don't feel right, then like I'm just not going to put them on the cap table. That, you know, that's hard to say if you're in like a scarcity mindset, like, oh, I just need to close capital. But I think it's important, right?

Hello everyone and welcome to this Founder Institute event on investor prospecting. My name is Ryan Micheletti. I'm head of global operations for the Founder Institute. I'm also a venture capitalist, a general partner at the Veteran Fund, which invests in military veterans, seed stage companies, and critical technologies. Excited to be the host today. We've got a really great speaker. We had about 500 people register for this event. So obviously this event is, uh, and topic is really critical right now. Um, so we're going to talk a little bit about developing a targeted list of investors, how to create warm introduction pathways, how to essentially create a full-scale investor outreach campaign and with different email scripts, and then also how to conduct the investor meetings and able to build trust and move the deals forward. So we've got Kevin Siskar, who we'll bring up to the stage here. So I've known Kevin for many years. He used to be the managing director of our New York program, and he is now the CEO of Finto, which specializes in the exact topic today. So Kevin, first of all, thank you for joining us. It's great to see you today.

Thank you so much. I'm excited. I'm excited to be here and I forgot to close the door, but—

Oh, it's got the zoom in. Nice.

Nice to meet everyone. I'm excited to be here. This is a topic that we spend a lot of time thinking about here. So yeah, Ryan, I'll throw it back to you and then let me know when you want me to kick off.

We've got a pretty big audience today and I think what we should do is maybe do like interactive Q&A throughout your presentation. So why— in a moment I'll pass it to you. You can kind of walk through the deck, and then when there's questions that come up, I'll maybe pause and jump in there. But if you have not already, the folks in the audience, make sure you say hello, tell us where you're tuning in from. If you're working on something interesting, go ahead and put it there, and then you can use the Q&A feature to submit a question for Kevin. Okay, Kevin, I'll pass it back to you. Let's get rolling.

All right, let me get my screen share up here and give me a thumbs up when you could see it here. Uh, can you see it, Ryan? Oh, you're backstage. It's a thing. I think I'm getting lots of thumbs up. I think that's what— I think that's what's happening in the, in the thing here. Um, well, nice to meet everybody. Um, my name is Kevin Siskar. I am an investor and founder. I used to be the managing director of Founder Institute New York City. Uh, we had blast back in the day having our sessions here. Between 2015 and 2020, I ran 17 cohorts of that program and helped 164 companies launch, some of which have now, you know, gone on and raised Series Bs and beyond, doing tens of millions of dollars a year. I host a podcast called Ambition Today where we share a lot of lessons, uh, from mentors, you know, people talking about what's going on. So we actually, uh, we're at New York Tech Week last week. We recorded an episode around what's going on in fundraising and AI, and you guys can go check that out if you wanna listen to it for free. I then worked at a seed fund for 2 years, so I invested about $10 million into 12 companies, early stage, seed stage. And what we saw is that fundraising is hard. It's miserable, stressful, soul sucking, the least fun part of running a company, founders tell me. And it's for a few reasons. 92% of dollars invested tend to come from warm introductions, which means it's very relationship-driven. And when you don't have those intros, you try to do cold outreach, just like, uh, sales and marketing, but it doesn't work the same way because it's not how investors tend to, you know, put dollars to work. And we'll talk a little bit more about how that actually works in this, in this. And then we also saw that founders, regardless of approach, were hacking a lot of software together, right? So They're making a spreadsheet of investors. Their pitch deck is in DocSend. They pay for a mail merge tool. Their data room's in Google Drive. And so it's costing a lot of money and the data is fragmented everywhere. So we built Finta. Finta drives deals forward for companies, venture funds, growth equity, real estate, the private capital markets. We tracked half a billion dollars last year. And through running Finto, we created something called the Finto Academy. It's a 4-week course where we go through a few different aspects of fundraising, uh, getting your deal prepped, making your target investor list, doing that prospecting, uh, and then doing your outreach. And so what I'm going to talk to you guys about today is actually week 3 of the Finto Academy, where we go over prospecting. And so We're going to make some assumptions here as we sort of dive into this presentation. I'm going to assume that the following are in pretty good order for you. Your pitch deck's good, you've got your data room organized, and you've built a financial model that tells you, hey, this is kind of how much I need to fundraise for, you know, 24 months of runway. Um, you've figured out which types of investors you're targeting, and we'll talk a little bit more about this today because this prospecting talk. But, um, this comes from Village Capital out of Boston. It's a really cool exercise you guys could do. The URL's at the bottom here, or you can Google it. But it helps you sort of figure out how far along you are in your company, and then you draw a line across and you can see which type of investors you should be targeting. We'll assume you've got your legal docs in good shape, whether you're doing convertible note, SAFE, or priced equity. We'll assume that you have a good sense of terms. So here's, you know, the market valuations for Q1 2025 according to Carta. Um, if any of you guys don't, I highly recommend following a guy on LinkedIn called Peter Walker, um, who anonymizes a lot of this data and shares it with everyone. So you've got a compelling story, your pitch deck's in order, your data room's organized. Let's get into it. All right, so Ryan, really quick before we jump into this, when someone does have a question, how are, how are they, uh They raise their hands or how does this work in Airmeet? I can't hear you, maybe because you're backstage or something. All right, I'll just keep going because I can't hear you. So let's talk about the funnel. Fundraising is sales. It's a numbers game.

Leads—

in sales, you have leads go to an intro, to a product demo, to a follow-up, and a close. Uh, in fundraising, you have leads go to a warm intro, typically, uh, they go to a meeting, maybe you go into a second meeting or due diligence, you go to a commitment, and then you go to close.

Could we— let me just pause here really quick, um, because I want to double-click on— sorry, I was backstage and, uh, just jumped in. So here's So here's a— let me set the context here. So Kevin just went through some basic things that sort of lead up to what you need to do for investor prospecting, right? So every single founder here, the whole point of this is you have to create a structured process around fundraising, right? The goal is to meet with, you know, hundreds of investors in order to close. And the only way you can do that is if you're very well managed and organized. So when Kevin was going through, he was sharing that, you know, in order to kind of focus just on the investor outreach stuff, the baseline things that you need to have covered up to that point is you need to have your legal documents in order, you need to have your data room set up, and you also need to make sure that you're current on the different terms and that everything that you're like— basically the fundraising ask that you have is aligned with what's happening in the market. And so maybe, Kevin, I, I don't know, we probably don't need to jump to slides here, but do you, um, maybe let's just lay the foundation there a little bit more and kind of dive into the phase one that you have, uh, right here. And then if people have questions, that, um, I'll just interrupt you and ask them.

Yeah, okay, so let's go back a few slides here. So, um, compelling story. So I think, you know, a decade ago we all sort of taught, hey, you just have to have these like 12 slides and you'll be good. But I think what you see nowadays is there's like 40,000 startups a year. It's very noisy. And so I think storytelling is actually one of the ways that you not only have a deck that's good, but you actually like grab people's attention and sort of pull them in emotionally to want to enroll, invest in what you're doing. And so storytelling is something that I'm really bullish on this right now. Pitch deck. Typically you wanna have these slides in there and typically there's a story throughout them, but you've got your problem solution, your why, your market size, your product, your team, business model, competition, financials. And you can see like there's different orders of these maybe to serve your story, but those are the ingredients that you have in there. And then data room. So when someone is interested in the company and they do want to, They do want to invest. They're gonna want more information. They're gonna enter due diligence, as it's called. And so some of the basic documents I would have organized are certificate of incorporation, your bylaws, which you created when you incorporated, your team agreements, including yourself being papered to the company, your financial model, which basically is a forward-looking projection model, typically 5 years, typically monthly, so 60 months, and shows how you expect income to come in, what your variable expenses are, and then how you're going to make hires. So what are your actual expenses? And those expenses are going to dictate, uh, how much money you should be raising. So when investors like, hey, I'm going to give you $2 million, how are we going to use it? You've already thought through that. Um, cap table, your ownership, uh, who has ownership, who has what shares in the company, any sort of IP documentation. And that's sort of nice to have, but I don't— you don't see all the time— is board minutes, board of consents, you know, maybe some information about your tech stack or your sales pipeline, et cetera.

Yeah, and I'll just add something here too. All of this, all of these documents will live in, you know, it could be as simple as like a Google Drive. It could be something like a Dropbox that's password protected. But at the end of the day, I've seen some really well-organized and really good data rooms that have tons of information, and those companies tend to get funded. And then I've seen ones that are very disorganized, not very well put together. And I like to share with founders that the data room is a reflection of you as a founder. If it's not labeled correctly, if you've got documents in different folders that don't belong there, and if you don't have all the right things, what that shows is that you might not have the— you might not be a good investment because you might be disorganized or you might not have the confidence to actually build a billion-dollar startup. Right. And so like I always say that deals can get killed in the data room just by looking at the metadata of is this well organized and are the right documents here. And so if you're maybe, you know, an earlier stage founder that does not have these types of, this type of data room prepared before you go fundraising, that's exactly why you would join an accelerator program like Founder Institute to help you kind of check all of those boxes and make sure you have that. So that's super important. And so I, I just would want to re-emphasize here, you shouldn't be going out fundraising until your data room is really locked in, because every investor is going to ask you, um, you know, if you have a great investment meeting with them and they're like interested, they're going to say, okay, share, share your data room with me. And that's where they're going to start doing due diligence. And if it's not well set up, then it could kill the deal.

Also, it's going to take you a bit to do it, not like, you know, weeks, but maybe a week. And so if someone's like, hey, send me your stuff, and then you just first start putting it together, uh, and then you send the email 2 weeks later, you know, they maybe drifted off or kind of fell off a little bit. So that's why we like to talk about, um, like getting all this deal prep sort of done up front, right? How can you make sure all the prep is out of the way up front? Um, how can you get all the prospecting done sort of next? Not all of it, but like 80% of it, because that's going to enable you to do some things I'm going to talk about at the end of the presentation here. So when you really are primed to start doing investor outreach, all the materials are there, you kind of know who you're going to go after, and you're sort of just running a process. And so that's what we're going to talk a little bit more about, uh, more about today. Sound good?

Yeah, sounds good. There's a question here about like How long should the pitch be? But let's, let's wait because I think we'll get into the investor conversation in a few minutes. So why don't you keep going?

Yeah, all right, let's get into, into the funnel here a bit. So fundraising is sales, it's a numbers game. Um, we talked a little bit about this already. In Finja, we have these stages sort of mapped out in the CRM we have. And so how you need to think about this: most founders are taking 83 meetings to close a round. Comes from data from like Forum Ventures and others. And so let's just say you take 70 to 80 meetings. This is first meetings with funds. That means you need top of the funnel, you know, 150, 200-ish names. It's actually not that bad. It's not sales and marketing. You don't need 10,000. You need like, you know, a little bit of qualified work. And then you're going to go to second meetings with maybe 25, 30. You're gonna go into diligence with a dozen or so. And then you're going to close some, right? And so, um, that's how you should be thinking about this. It's a numbers game, but unlike sales and marketing, it's not a spam game. Um, this is Brendan Baker. This is a really good talk I'd recommend all you guys sort of check out. It's called 5 Pitch Mistakes that Entrepreneurs Make and How to Fix Them. Uh, Brendan was a partner at Greylock, but he also was employee number 2 at AngelList. So he spent 2 years looking at 8,000 presentations. He singled out that in this talk that story arcs are kind of what separate the good from the bad, which we talked a little bit about. But what he also did is a study. And so he started to map what does a seed round look like? And if you Google anatomy of a seed round, you'll see his slides. And basically, like, this is it. So everything sort of spiders through relationships. This is from June to October. And I'm just gonna go back to this slide because it kind of emphasizes that my point here, which is like, you know, this person did $200K, this person did $100K, this person did $5K. They might be disappointed by that, but this person helped, they made intros that led to a $25K, that led to a $50K, that led to a $50K. So that $5K actually resulted in more money because that person was more helpful, leaned in and opened more doors. And so that's kind of what happens here. And you need to be chasing down those relationships and sort of thinking about, about that. Ryan, when you see companies and even your own fundraising for the fund, does this resonate with what happened?

Yeah, 100%. Most people here probably can't just put together a spreadsheet of 200 investors they know right away.

And so it will by the end of this presentation.

What ends up happening is you meet one person, you get them to like you and like what you're building, and you ask them for help. With investor intros and then maybe they do one intro or two or 10 or whatever that looks like, right? So you have to kind of get people advocating for you because they believe in you and they have enough conviction in you where they're willing to burn some of their social and political capital to introduce you to important contacts of theirs. And so that's where having a really good pitch, having a real, like your company has to be fundable, right? You have to be at the right stage. Otherwise people won't want to risk that. But the, the— I like the spidering of the network where it's like one, one conversation could lead to another conversation with someone else, to another conversation, and that's how you ultimately get that like top of funnel 200-person list.

Yeah. All right, so let's talk about the process. How do we do it? So you are always raising money. You're either actively fundraising or you're not, which means It's either active or passive. We're going to quickly talk about passive fundraising because it primes the pump for active fundraising. So what does that mean? When you're passive fundraising, you know your pitch cold. You're in this sort of deal prep phase. You may be workshopping some things. You're networking a lot. You're starting lots of relationships. There's a really good article by Mark Suster at Upfront Ventures called Invest in Lines, Not Dots. And really talks about that relationship building with investors and how what they're really looking for is you to say you're gonna do a thing, do a thing, and then watch you do it. And then you say you're gonna do a new thing and they watch you do it. And you do that enough times, you start to build trust between the two. You start to build a real relationship. And so the easiest way to do this is sending investor updates. A few years ago I went, and this is on my personal blog, sysgar.co, but if you just Google it you can, you can find it. Um, I grabbed everybody else's investor templates and I put them all in one place. So you could find Jason Calacanis's or Ty Danko or Jack Greco or Alex Skold. They're all here. Um, and so what you're going to basically put in these is, you know, your KPIs, your highlights, uh, the good, the bad, the ugly, just little wins on, on the company and what you got going on. It's 100 names to start. And when you build this first list of 100 names, it doesn't have to be investors. It could— this first list of 100 names can just be people who want to see you succeed. It could be friends, family, aunts, uncles. Again, they want to see you succeed, they're going to make intros for you. You're going to share your details of your progress since last month or the last quarter. You're going to share meaningful milestones. And then really important, you want to have 1 to 2 simple asks at the bottom. And believe it or not, like, people will respond to those and help you out. Here's one of our updates from last year, uh, you know, the good, the bad, the ugly. We, you know, had a little highlight at the top. We helped the company with their $7 million round, you know, how much we tracked, um, product updates, etc. What I like to do is I usually have a notepad going throughout the month, and as I think of little things, I'll just Save them as bullet points, and then at the end of the month I'll block off 2 hours, I'll write my update, and then something I'd recommend you use is a mail merge tool. So each of those 100 people will get their own email, um, and you send it to your list. Pinta is a mail merge tool. If you end up checking this out, it's free to sign up. Um, you can put your updates in here and then blast them out and they'll go to everyone one by one. And sending the updates leads to miracles. It's the first start of this list that you're going to build for target investors. People will connect those dots, right? They'll respond to your asks, they'll provide encouragement, and most importantly, like, you stay top of mind. I think as founders we get so busy, we get heads down building, we don't realize that if people don't hear from us, they just sort of assume your company's dead, um, and they go think about something else. And so staying top of mind can be really beneficial, uh, even when, you know, a week later, uh, they have a coffee with someone and they remember you, and then they think, oh, I should go connect, you know, Ryan and Rachel or something. You'll get meetings. You're not asking for money during this time, right? You may be asking, hey, is my company investible? You're going to maybe ask for feedback on your deck. But my favorite question is number 4, actually, uh, who else should I be talking to about this? You want to start to pull those second-degree connections out of these people that already want to see you succeed. and that really helps you organically start to build this target list. Ask what milestones you should be focused on, right? So how should you hit the thresholds to make yourself fundable? And so your goal with passive fundraising is to stay top of mind, draw the dots so people could see you executing, saying what you're going to do over and over and over, so they can invest in the Lions. Any questions on passive fundraising before we go into active fundraising?

Um, there's a few in here. Um, you know, I guess like we'll just start diving into here. So how does fundraising look like for solo founders, um, especially with AI, vibe coding, and development? Yeah, so maybe like, so like solo versus co-founder fundraising.

So like the event we did in New York last week for New York Tech Week was actually fundraising with AI, so we kind of talked exactly on that, like Um, it's a weird time. The data says the markets are recovering from the crashes of 2021 down to '22, '23. Uh, emotionally everyone feels like they're standing on shaken ground because of tariffs and whatnot. Um, some investors are getting weird and squirrely. I had some investor friends who were like, we're done with software, we're never gonna— we're like, we're moving on to, uh, you know, climate tech and biotech and all this stuff. And I, I think that's a bit aggressive. I don't— I think maybe that's a true 20-year thing, but I don't think it's true in a 1-year thing. Um, so, you know, I think the answer is you can analyze things all day, you could try to time your fundraise, but that never works, right? You just have to kind of commit to going and running a process and getting through this sort of end-to-end. And like, If you've taken 100 meetings and you're still not getting anything, well then something's wrong. You gotta go back and you gotta fix your deck or you gotta, you know, fix your targeting. But I actually got this from a founder friend, actually a Founder Institute grad, Will Thax, who founded a company called Kindara. And when he coaches companies, he has them just fill out a piece of paper with 100 empty boxes on it. And just says, you know, by the time you fill in the 100 boxes, your round will be done. So, you know, it's about getting out of this scarcity mindset and getting into an abundance mindset. But we'll talk a little bit more about what this funnel actually looks like once you get into active fundraising.

Right now, I also just, uh, in the chat I put a link to fundraising benchmarks, and I think this is really important for people to take a look at because I think there's also a component of this fundraising at the right time. So in the example where it's like, let's say you run a really good process, meet with 100 investors and no one wants to invest. Well, there's probably something wrong with either your business, the market you're going after, or, you know, other things. Looks like Kevin may have accidentally exited out here. So it's really, really important to make sure that you have the right benchmarks. And that you're fundraising at the right time. And so you have to kind of think about it from an investor's perspective. So you're an investor and you're looking at, let's just say, like 5 to 10 deals a week, maybe more. And so there— and you're only able to, let's say, invest in one company a month. So you're looking at your— you as a startup founder competing with, let's just call it, 50 other companies that are also trying to get in front of that same investor. And raise capital from them. So how do you become the lucky one startup founder that gets funding out of the 50 that they're also speaking with and meeting with? Well, you have to make sure you're in the top 10% of companies because you need to be able to cut through the noise with a compelling presentation that gets them to want to talk to you on a call. You have to run the call very well where they're interested and they want to learn more and they want to dive in deeper with you. Or with their partners. And then even when you get to that point, like even if you get a term sheet, like half the time the deal falls through anyway. So just, it's important to like not underestimate the amount of traction and progress you really need to go out and fundraise, especially from VCs. Now I saw someone in here is raising like a friends and family round, like $50K to $200K. That's totally fine and normal. Like, you know, if you have relatives or friends who can invest, $10K, $20K, $30K, $50K into a small friends and family round, that's great. It's a good way to get going, but make sure that you visit that fi.co/benchmarks page just so that you have a sense of what your competition looks like for competing for the same amount of dollars that you're fundraising for.

All right, I love that. So sorry about that. I dropped off when I tried to share your benchmark slide, Ryan. Yeah. Uh, so on Ryan's quick note here, not to get too much into valuation stuff, but this comes from Michael Ho. I just pulled the slide real quick from my other deck, um, around traction, right? So to give you guys a sense, because I think a lot of founders get stuck between these two, um, if you want to raise a pre-seed round, like, most investors are very okay with there being no revenue. About half of them are. And even when they are looking for revenue, they're looking for like less than $150K ARR. But the moment you're like, oh, I'm gonna go raise a seed round, you just change that word and it's gonna be a little bit more money. Well, then they wanna see a lot more traction. And in the last year, this has really slid. This used to be more like $150,000, $250,000, and it's sliding upstream. The founders I'm talking to are saying the investors that they're talking to really want $500,000 to $1 million in ARR to get a seed done right now. So just to give you a sense, like, That Benchmarks, uh, slot, uh, website is great. Lots of resources now to figure out sort of where you should be in the market. Okay, so active fundraising. So you're investible, you're polished with your deck, you've got your network built, your data room's organized. Let's talk about qualifying prospects to get that list built. Every investor, when they raise a fund, has something called an investment thesis. That's the strategy by which they told the limited partners that they would invest their money. Uh, and so if you go to an investor's website, this is typically the first thing on, like, top of the fold, above the fold, you know, on the home page. Uh, so you could typically really quickly sort of figure out, like, hey, is this investor a fit for, for my deal? This is a bit controversial, and not everyone agrees with it, but start with your lowest priority investors. It's just normal that the first few times you pitch, it's going to be worse than the 25th time you pitch. You're going to hone it in and make it better. And so, you know, practice. Have those first meetings with investors you maybe don't need, slash, you know, really, really want, um, and improve your pitch as you sort of go through this target list. Avoid people invested in competitors, or maybe the fund is fully deployed, they haven't done any deals recently. And the wrong target stage or geolocation. So, you know, if you're raising a seed, don't go after Series A investors. You will waste a lot of time. You want to stack rank this list by priority, so you can rate them like ABC, whatever you want. I try to think about the expected value when you rank these, right? So how good would it be if they did invest? Do I have to go through partners? They have decision-making ability. What does all that look like? And so let's talk about how to get the data to pull these lists. There's two ways I think about this. There is top-down prospecting. These are the best investors for my deal. And there's bottom-up prospecting. These are the investors I can know I can get to via warm intro pathways. So let's talk about top-down first. We built our own database inside Penta. When you activate a deal in the platform, it'll automatically recommend investors, uh, and Aurora will go to the internet— that's our AI— and start doing searches on the internet to pull in more investors, uh, specifically that are on thesis for your deal stage, sector, geography. Signal.nfx is a really great resource. Uh, you can connect your inbox, it can help you find, uh, people you may already have in your network, uh, and it's free. They are a VC fund and they put this out to help founders, and it's great. There's a cool website called VC Sheet, public information about investors organized by lists, essentially, of, you know, investors who focus on climate tech, investors who are, you know, Series A hardware. It's a pretty cool site. It's well designed. I like it. It's nice and clean. Something I do often is I'll take screenshots of VC Sheet and I'll feed it to Aurora and she'll read the text and then add them to the CRM, you could probably do the same thing with like ChatGPT. You just screenshot the page. Crunchbase, free to sign up, not that expensive if you pay for Pro, like $200 for the year. PitchBook, very expensive if you pay for it, $24,000 a year. Uh, but maybe you have a friend who has a PitchBook account, uh, and you could ask them to, uh, to export something or pull a list for you. There are lots of third-party lists. You guys will probably see on LinkedIn every like day or so where it's like found this list of pension funds or family offices or series seed, and, you know, just comment below, like and follow me, and you'll get the link, or whatever. Like, there's so many of these. Um, we grabbed them all and we put them up on a blog post on our website. So, uh, Finta's all-in-one master list of VC databases— there's about 45 of these lists that we've grabbed over the years and put up here. You can go check out.

Now, Kevin, let's talk about the cold email outreach, right? Because like, it's tempting for first-time founders who are like new to fundraising to just say, okay, great, I've got this list of 40,000 investors and I'm gonna like, you know, just reach out to all of them and see what happens. Could you kind of share what works, what doesn't, why they should, should not do that, or maybe, you know, some ways that maybe it would be effective?

Yeah, uh, it doesn't work. So, um, We— I see founders a lot who will take the sales and marketing playbook they're already running in their thing. Maybe they're using Instantly or some sort of, you know, cold outreach or automation sequences in HubSpot. It's natural. I mean, I get it. You try to apply that to a different set of leads. Um, but the problem is that investors are getting inundated all day, every day with, um, requests to meet. In fact, do I even have slide in here. Let me jump to my other slide here. Where is it? Maybe it's in this one. Hold on. What do you guys still see this? I have to share my So, um, yeah, where are we here? So I mean, like, if 90% of deals close from warm intros, then that means 10% do go from cold outreach. Your goal is to stand out. Your goal is to get the attention of them to want to meet with you. Um, Purple Cow is a good marketing book by Seth Godin that sort of covers this. And so that when you think about cold email, it will be a part of your fundraise. Your job is to make it as small a part of your fundraise as possible. Leopold, that's always sort of— I always like this one. Assume a VC has time to meet 6 new companies that week. If they get 3 good warm intros and 50 cold emails, well, they'll meet 3 intros and 3 cold emails. But if they get 10 good warm intros and 50 cold emails, they'll meet all of the warm intros and and none of the cold emails. And so you could do it, you know, I would still recommend like shoot your shot over not, right? There are some good ways to do it. You know, you really want to, it's more of a marketing exercise. You wanna figure out how you sort of grab people's attention, but it's hard. I mean, I angel invest from time to time and I get these all day, every day. Ryan, I'd imagine properly being like a fund manager now, your inbox probably just gets slammed with these and it's like, it just becomes noise and, and it's, it's hard to filter and search, and so it gets ignored. And then other pathways that are a little more exclusive to you probably get, you know, the attention. But what do you see as a fund manager?

Yeah, it's the same thing. And then like the worst part is like the lists are like wrong, where somehow they got a different email for me and put a different name. So like it's like my Ryan email at a different organization, and then they call me Anthony. It's like, hey Anthony, like, just following up. And it's like, it's just like, it's like there's no way I'm ever gonna talk to you. I usually just block them because it's just like, it's not worth my time even opening those emails. And as a fund manager, like, you have to be very disciplined with your time. So that's another risk of cold investor outreach. Most of the time, if you've done it, your domain might get like blacklisted cause you're gonna get blocked from a bunch of people. So that's where it's like, now if it was really targeted, the one time I did take a cold outreach was when the founder had really impressive traction and it was an actual fit. It was like a critical technology company. They had a really interesting traction and they just emailed me outta the blue and I was like, oh, this sounds really cool. I'll meet with this person. But it was a fit. It wasn't just the like a, Hey, invest in this like e-commerce company that we don't invest in e-commerce. So it's just a waste of time. So if you are going to do cold outreach, be disciplined with who you do it. Don't just, don't just do like a campaign to like 40,000 people, like narrow it down to like who are like the 20 investors where it's an actual fit based on their fund thesis. Then it makes sense to reach out. And then, and then also when it's a smaller list like that, you can, um, you— it's easier to customize. So you get— and that's what will help get the attention as well.

Yeah, my last bit to answer this is like, find other ways, right? Like, your goal is to build a relationship, right? And so, um, start, you know, not asking for things right away— give me money— but like, how could you add value to this person? Maybe you have a podcast that you invite them on to, or I don't know, you make an intro for them somehow, or like you find some way to add value before you take value, right? Like, that's— those are ways that you can start to build those relationships sort of over time. All right, let's go through a few more here. So deep research, this is a new one. I'm— I use it a lot. If you use ChatGPT and you have access to deep research, you know, it kind of fails if you try to do more than 20 at a time. But if you tell, you know, ChatGPT like, read this website, um, I'm raising this amount, a seed round, uh, go find me seed investors and make sure you pull their first name, last name, LinkedIn URL, org name, um, it'll do it. And honestly, the O3 model that came out a month ago, which we use inside Finta to power Aurora, uh, is very, very, very good at this. Okay, so bottom-up prospecting. Let's talk about how you can get access to some investors who you will already have a warm intro waiting for you. Um, this will be easier if you've been passively fundraising because you'll have people in your network who already want to see you succeed that you can tap into for intros. But what you're going to do, you're going to go to LinkedIn and you're going to start a new search. Try initially with like VC or venture or angel. Um, if you do these OR or AND booleans, they have to be in all caps. Just be aware of that in the search bar. You can then filter for degree, so you could say second-degree connections, first-degree connections. Um, if you do first, you'll see all the investors you already know. If you do second, you see all the investors that people you already know can introduce you to. And what's cool is every time you update the search terms, LinkedIn produces a new URL, and so you can copy that URL and you can take that over to a tool like Phantom Buster who will export all of your second-degree or first-degree investor connections into a spreadsheet for you. And so voilà, within a few minutes you have a list of hundreds of investors that you already sort of have intro pathways to, or you may even already know. Here's, uh, some terms if you guys want to screenshot this. Instead of VC or angel or venture, you can also do analyst or associate, um, Some of these might also pull like lawyers or like general partner can sometimes pull in lawyers. So you'll have to do some filtering, but this can be helpful. You also wanna make sure you're always looking at the mutual connections. So if you're looking to get in touch with Doug Leone at Sequoia, well, I have, you know, 6 people who could connect me with him. I would click into there, say, which of those 6 am I actually closest with? And I'd go ask that person for a warm intro. Another reason fundraising is tricky is because I am the only one who knows which of those 6 people I'm closest with to ask for the intro. If I try to outsource it to someone on my team or an assistant or someone, they have no idea. They don't know whether I met that person at an event or if I actually just, you know, accepted their random invite on LinkedIn. And so it just, it is time consuming, but you know, this is the way, uh, this is why founders have to be the ones sort fundraising. You can also leverage this LinkedIn search feature to do connections of. So if you go to all filters, connections of, and then you put in Ryan Micheletti, you'll see all of the investors that Ryan knows. And then you know that you're going to ask Ryan for the warm intro. I thought that was funny. All right, keep going. Um, so, uh, in Finta we built something called investor networks, so we also can help you do this with email inboxes. So you can come into Finta, sync your email inbox, and we will sort all those connections by relationship strength. And so now you can access LinkedIn, but you can also access the email inboxes of everyone on your team, on your cap table, and figure out who those, who those mutual connections are. And so your goal here is really to take these people that already want to see you succeed— your founders, your investors, which might be your friends and family to start— advisors and team members. You want to figure out how to crack open their networks, use them as the warm intro pathways to populate your list, uh, send these intro emails, and then you will get meetings. It said Finta, if you go to the prospect page, you can create my network. We'll skip that for now. Um, but let's quickly talk about warm intro requests because these, in the industry of fundraising, venture capital at least, have a industry standard format. So Alex's school, the Techstars, kind of made this popular a decade ago. But basically you want to do something called affordable intro email. So, um, if I wanted, uh, I'll use this example again. If I wanted Ryan to introduce me to, um, Rachel Shepherd, who's an investor at Mars, I would send Ryan an email that's affordable. So, hey Ryan, thanks for passing this note to Rachel. And then the whole email would actually be addressed to Rachel. It'd be about Rachel and Mars and their pet tech accelerator, right? Um, and then from there, Ryan would be able to forward it. Rachel could reply, be like, not a fit, or I'd love to meet, and then he can connect us through. And so it's really important that you write these emails well. You write these in this affordable way. And the goal of this is to make the lift as light as possible for the people that wanna help you. Um, in Finta, we automate this so you can just set your warm intro script. And then put someone in your intro pathway and it'll create the email and we can fire it off because we're connected to your inbox. Ryan, do you have anything else on warm intro emails in terms of like the formatting or requests?

Keep it simple and keep it short. Like so many times it's just like people will overwrite in their emails and it's like, dude, just give me the two sentences of the most important thing that an investor needs to know. Because that's gonna be what catches their attention. And if you get their attention, then they'll want to go in and look at the deck or look at your website or set up a meeting with you. But if you just immediately overwhelm them with too much information, they're just gonna— it just makes it really easy to ignore and just go straight to archive. So keep it simple.

I'm gonna double down on that and say that also goes for the pitch deck too, right? So, um, You, you— that goes for this whole process of the funnel until really you get to due diligence. When you get to due diligence and so like then overwhelm them with like all the data and documents, right? But like up to that point, you're really— it's kind of a little bit more marketing where you're trying to like emotionally pull people in without overwhelming them because people will shut down if you do that. Um, that's a great point. All right, as you do this prospecting, you will see that you have a lot of the same people maybe coming up again and again. These people are super connectors. They maybe had a podcast or they ran something or they had a fund, but they did something that let them meet lots of people in the industry. You wanna leverage those people. Something I'd recommend is before you actually ask these people for, you know, a bunch of warm intro requests, you just take the time to catch up with them. Hey, let's go grab a cup of coffee. Oh, it's been so long. You wanna jump on a Zoom? And just go have a conversation without asking for anything. Obviously it's going to come up in that conversation that you're fundraising, and oh, interesting. Oh yeah, you know, okay, send me the deck, I'll take a look, right? But you don't want to, uh, overwhelm again. You want to personalize these intros. Um, you want to prioritize potential lead investors if the round is priced. Um, but this is the big one I want to sort of like make sure you guys all get. And the reason for doing all the prep up front is you want to kind of fire all your arrows at once. So you want to create calendar density when you're fundraising, because if you can have multiple investor meetings a day, a week, you could start to create momentum with the round. Oftentimes I'll see founders who will talk to an investor after an event in January, and then one more investor a month later, and then another investor two months later, and it's like It's not enough to get anyone to sort of shit a good off the pot, for lack of a better term, and drive forward and create that commitment and that urgency to close. So calendar density can be a big weapon that you can sort of easily put in your pocket. So with that, we'll wrap it up here and we'll open up the Q&A. You know, remember, it is a numbers game, so don't get discouraged, you know, when you get your first 12 nos in a row, keep going. I highly recommend these books. So Founding Sales is a book that all the Y Combinator companies get when they start, uh, by Peter Casangi. I had him on my podcast, um, and it's more about like founder-led sales but also that abundance mindset of getting into that.

And so cool.

Fundraising Rules by Mark Peter Davis is another good one, um, and then Fundraising by Ryan Breslow is super short, it's only like 40 pages, but it has lots of good content in there, uh, you could check out around investor behavior and how to sort of reply if they do certain things, etc. Um, trust the process, go Bills, and, uh, I'll open up to questions. Cool. Anyone wants to email me, uh, feel free, my email's right there. And then I think I'm going to share an office hours link with you guys as well that, uh, Ryan will send out a little bit later.

Yeah, you can, you can put that in that, the chat too. So let's go to Margaret's question, um, she asked earlier, which is like You know, do you guys believe the pitch should be 6 minutes or less? Because with the 6-minute rule, I don't see how there's time for a background story. And so like, maybe let's just kind of focus a little bit on the investor meeting itself and like how, how it should potentially be run by the founder.

Yeah, um, I think you should just ask the investor. Um, let's see, I have a slide for this too. Uh, I think you should just ask the investor. You're in charge of the meeting, set the agenda at the beginning, you know, ask them, hey, do you guys want a 5-minute overview or a 15-minute detailed pitch? Um, the other thing is like, don't just like lunge into your pitch, right? Like asking about the weather, you know, uh, talking about things you have in common, right? Like these people are going to work with you for a decade if they invest, uh, and you're essentially going to get married. And so you want to make sure that you— at the event last week, Catherine at Buildstock basically was like, yeah, like, I vibe check all my investors. Like, if they don't feel right, then like I'm just not going to put them on the cap table. That's hard to say if you're in like a scarcity mindset, like, oh, I just need to close capital. But I think it's important, right? Like, yeah, no assholes is a good policy for your cap table. And you don't want to be working with someone who could end up, you know, screwing you later. So, um, I would, I would about that.

Let's take that to the tactical level. So I think what you just said about don't just lunge into the pitch is extremely important, right? Because, um, you know, it just shows, it makes it feel very transactional. So it's like, oh, hey Kevin, nice to meet you, my name is Ryan, here's the, here's my pitch, and I'm— you just like The worst investor meetings are where the founder talks for like 25 of the 30 minutes and the investor doesn't say anything. So there's an interesting study by Stanford where basically it has to do with first impressions. And, you know, the bottom line is that whether it was a 15-minute or 30-minute interaction or the first 2 seconds of an interaction, the The person who you are communicating with takes that first impression and that's like the lasting impression. So literally even the first like 2 to 5 seconds of the meeting are very important because it's the foundation of it. And that's not to put pressure on it, but it's like, you know, we jump on Zoom, smile and like say, hey Kevin, nice to meet you. How are you doing today? Right. And like, you want to open it up like very warm and then like, don't jump into the pitch. Like ask them where they're from. You know, say like, hey, like, you know, what are you seeing in the market? Get them talking, get the investor talking, because the more they talk, the better they think the meeting will go and the better they'll feel about the meeting afterwards. So make sure you just spend, like, try to spend like at least 2 minutes, ideally 5 minutes, like just chatting with them, trying to build rapport. And then when it's time to actually get going with the meeting, you ask them, hey, I can walk through the pitch if you'd like, or we could just have a high-level conversation. What would you like to do? And then that way, you know, if they want you to do the pitch, you do the pitch. And if they want to just talk about it, you guys can just talk about it. And that shows that you have confidence, not necessarily needing to rely on the pitch deck, but, but just being able to, to discuss what you're building.

Yeah, I agree. And, uh, yeah, go ahead, go to the next question for the second time. I was going to go into a story about an investor from a week ago, but we'll Um, okay, so let me just kind of go here.

Um, there's a lot of— there's a lot of like small questions here, like, you know, uh, about— so this event is recorded, you'll get the recording afterwards, I believe. Um, you won't get the deck though. Um, okay, while being in between pre-seed and seed, my team and I were able to complete the working MVP What's the best way to explain this to investors to justify early traction but no revenue? So basically, like, Philippe, I don't know where you're based, I don't know how much your pre-seed was versus your seed, but like, you know, how do you, uh, how do you explain your traction when you have no revenue, I think is like the question.

Yeah, I think it's about qualifying the investors and make sure you know you're talking to an angel or one those early stage investors. Also be self-aware of like around where you are in the country or the world, I guess, because oftentimes you'll see like Midwest investors in the United States will basically go really low. Like there's a lot of regional variance and like valuations and traction. So like, you know, I had one time had an investor who ran like the local angel group be like, well, we want you to do, you know, 100 to $200,000 in revenue, but we wouldn't want to pay over a $2 million valuation. And it's like companies incorporate and we tell them to be $3 million out of the gate. And so it's like, you know, some investors, um, pattern matching correctly, and like it's part of your job to not get caught up in that. Um, but I think it's okay, just be transparent. Like if you're, if you are running a numbers game and you're running a process you know, and you take 70 meetings, you're going to find 10 or so that vibe with, with what, where you are traction-wise. And the other thing I would say to this is actually it might not be so much about traction. You might start to figure out that there's other things that qualify the lead. So for Finta, if I'm talking to an investor who was like an ex-Wall Street guy or spreadsheet junkie, like, they don't get it. Um, I literally had one investor who was like, I look at DEX and I send wires all What's the problem? And I was like, well, founders do a ton of work to put this deal in front of you, um, and so that's the problem. Uh, but then if I talk to an investor who was a founder and sold a company or whatever, they immediately have empathy for what we're doing. Um, again, Catherine last week at the New York Tech Week event, she's building a B2B construction marketplace for building skyscrapers in New York City. And, you know, in certain investors have an empathy for what she's building, a Maybe this is a better way to say it, a passion for what she's building and really understand it. And so the traction doesn't become like the first thing they're talking about. They're really sort of like melding over like the vision of the company and all this. And so I think, think about how you can like qualify that. How could you ask questions just as like you're on a sales call to the investor to figure out like, hey, is this person going to fit how I want them here? Um, and then the last thing is like West Coast investors are much more likely to be cool with less traction and more focused on, hey, there's a killer team here. There's some other component that's important. Like a good team will figure it out. The East Coast is much more ex-real estate investors. Maybe they're just sort of learning venture capital and they wanna see a lot more traction.

Let's go do one more question here. This is from Jasmine. Should there be a difference in your pitch approach when raising from angels versus, uh, pre-seed funds or VCs? So maybe we could talk about like raising from angels versus raising from, uh, VCs and like what the differences are.

Yeah, uh, you need to be buttoned up and your, and your traction needs to be a lot further along. So that pre-seed investor is going to ask a lot more about, um the team? How did you unlock this like unique insight to build this company based on your past experience? What is this first version? It's okay if there's no revenue. Um, and from there, you know, you go to a seed round, it's going to be— I'm going to start to dig in on the data. Do they have the traction? Do they have any sort of product-market fit? Uh, maybe I'm going to call some customers and I want a customer recommendation. Or referrals. Maybe I'm going to call some existing investors. How's it been working and watching this founder? And then Series A and Series B and beyond just becomes more and more numbers-driven and a lot less, you know, um, human-to-human, uh, founder-driven.

Yeah, yeah, I think that's right. There's also a different return profile. So for an angel, if you can give them like 3 to 5x in 4 or 5 years of their money, like a return, they're going to be super happy. Versus a VC, they sometimes, depending on what stage they invest in, they want to see like 100x. They want you to get to that billion-dollar valuation because they need to—

the—

just the way that the VC math works out, they need to return the entirety of their fund based on one investment. So if you've got a $20 million fund as a VC, when one company has an exit, you want to make sure that you as the VC will receive $20 million just on that one. And it's because the failure rate's very high. And so just know that like there's a balance between raising from VCs and angels where angels might be, you know, a little bit faster, maybe a little bit easier to get like these like smaller $50K checks, really good in like the pre-seed stage. But as soon as you need to go out and raise like a $4 million priced seed round, that's where It'd be hard to do that with a bunch of $100K angel checks. You need to go out and get a lead venture capital investor who's going to put in $2 million of that round. So that's where you sort of go from this experimental MVP stage of, okay, let's make sure that we're building something that can get some traction to, okay, we've actually built the thing and now we're ready to pour the gas on it and scale it with a large amount of funding.

Yeah, yeah. Essentially, in that first round, you're really focused on, you know, basically proving that you can build, uh, anything. Um, and then, um, let's see here, um, you know, a little bit of tech. The seed, you're going to prove the market. The A, you're going to prove scale. The B, you're going to try to prove profitability. Maybe you might need a C or D as well. And then beyond that, you're gonna go exit. Yeah.

Cool. I think that's all the time we have today. I really appreciate you jumping on here, Kevin, and kind of sharing this. We are going to continue with some networking afterwards. So in a moment, we're going to end this broadcast. You'll go back to the room that you originally joined when you first jumped in here. And everyone can either use the speed networking button at the top, or you could join tables and kind of chat and meet some of the folks who are in the audience today. I want to thank everyone for joining. Kevin, always great to see you, man. And, uh, thanks for having me. Yeah, we'll do another one soon. Thanks, everyone. Bye, everyone.