Whether it’s some angel investments to test-run an MVP, or an attempt to close a pre-seed or a seed round, any startup founder finds themselves at a point where they need to raise money. Just like everyone else these days, the investors are online. Genia Xasis, CEO and Co-founder at Berkana.VC, a community for female VCs and tech founders, and Investor Relations expert in the MENA region, shares the effective strategies and digital tools that will help you to jump start your engagement with the investors – and talks about the endgame of this exciting process.

Step 1: Cast your net on Facebook

The common wisdom in the startup world says that the first investments usually come from 3Fs – friends, family, and fools. Since nobody really wants fools for investors, we’ll rephrase it a little so that 3Fs stands for “friends, family, first circle.” That circle includes former colleagues, business partners, and previous investors. They may just be the right people to cut you your first check and get the ball rolling.

Start your investor outreach strategy by looking closely at your Facebook friends list. Use your knowledge of your friends’ investment history to compile a list of potential leads. Once you have it, start reaching out. And don’t be discouraged when people decline your offer to invest. Use these conversations as an opportunity to ask for introductions to their acquaintances who may have a different view.

Step 2: Revamp your LinkedIn

LinkedIn has always seemed like Facebook’s ‘un-cool’ sibling, but that was ages ago. Since then, many people have already made it their primary social media presence. According to the platform’s own data, it has around 1 bln users representing over 200 countries. Of those people, 65 mln are business decision makers. And research confirms that the greater the founder’s LinkedIn network, the more successful they are in raising investments. 

Your LinkedIn page is the first thing that a potential investor will scan after receiving a message from you. Here are the top tips that will make it informative and useful.

Role is the first line under your name, keep it short and sweet. Don’t list all the hats you wear in your company and all the areas of your expertise as this will confuse the investors.

About is a block of text right under your picture. This is basically your prime self-advertising space, the first thing that people learn about you. This section should be a couple of paragraphs long and include your key achievements, important financials and other numbers, names of prominent people, and a list of major companies and brands that you have worked with.

Experience section is where you share your career trajectory. Use this space to highlight your personal achievements related to the company/project’s development.

When choosing between Skills and Recommendations sections, choose the latter. Investors will look to Recommendations to get a sense of who you are, so ask your colleagues and partners – and other investors, if you have them (or had at your previous projects) – for some.

Now that your page is ready for new visitors, there’s the last step to take — make sure to populate it with regular content that is relevant to your industry or your role. It can be posts with news items and newsletter promos, or, even more valuable, your personal opinion about the relevant market news. Just don’t share links to articles, that’s a waste of time. But LinkedIn is a social platform, so it’s not enough to share your professional or industry news. Comment on other people’s posts and upvote your connections’ information – be proactive and social. When you publish new content, the algorithms make you visible to your subscribers. Leaving thoughtful comments or sharing others’ posts with your thoughts are also a great way to increase visibility and attract the right kind of attention.

Step 3: Create potential investor funnel

Now that your page is ready and you have a content plan for your feed, you have to create a funnel of potential investors. Draft your list using all information available to you. It may be standalone lists of top N investors in MENA. Or it may be the Crunchbase database of investors filtered by the parameters that are relevant to you.

Here are some of the main parameters that you should keep in mind when you do the search:

• Type of investor — angel investors, venture funds, high net worth individuals, family offices. Choosing one or the other depends on the size of the check you are looking to close.
• Startups usually go through several stages of funding, and investors often have preferences for specific investment stages. When you do your search, filter out those who invest in your stage.
• Typical size of the check that they write.
• Preferred location of investments. Some investors are open to projects anywhere, but others have clear preferences, make sure to contact the ones who work in your region.
• Preferred sphere of business. Investors are people and people have preferences. If you have a MedTech startup, find the relevant investors.

If you are doing your list compilation through Crunchbase, the search results will return with the links to investors’ LinkedIn pages. If you are doing it any other way, use PhantomBuster or LinkedIn Helper or Expandi to add LinkedIn profiles to the names on your list. Once you have that, use GetProspect for emails together with Lusha extension for WhatsApp number to add investor contacts to the list.

Step 4: Prepare the outreach strategy

Now that you have your database of contacts, time to start writing. You have to create the outreach chain — a set of introductory letters. Not just one, but several!

Below you’ll find the description of the basic approach to outreach efforts, but remember that it must be adapted to specifics of the region, seasons of the year, and other factors. For example, remember that in UAE all business activity ceases from early spring until September, because first comes the Ramadan, and then the hot months of summer, when most residents prefer to leave the country for cooler places. Therefore, your summertime letters will fall on deaf ears, so to speak. Plan your communications accordingly. 

Write a personalized introduction letter. Make it short but informative. Introduce yourself, your area of business, and your goals. But don’t start with a sales pitch just yet. Your first letter is about making a contact. Study the recipient’s LinkedIn page beforehand to find information that you can use. Maybe the investor has recently spoken at a conference and published the video on their page — you can watch it and express your interest in its ideas in the letter. Or you may ask the investor for advice on your company’s plans. Ray Walia, an investor himself, coined this adage eight years ago: “Ask for money, get advice. Ask for advice, get money twice.” You may even discover that you share some exotic hobby with the investor — and use that to establish rapport.

If you didn’t receive an answer to your first letter, write a polite follow-up.

Suggest a phone call, request contact details, get ready. Your goal is a video call or a personal meeting with the investor. Face-to-fact contact is the best time to talk about your startup in greater detail.

Once the first contact has been established, try to set up a call.

If you succeed in setting up a call, ask for the investor’s WhatsApp or other contact details — this way you can be confident of their interest. Only then, move on to the sales pitch: tell them that you are raising a round and would be happy to discuss the possibility of cooperation.

At this point, you should already have the three things you need to raise a round: 1) a great pitch deck; 2) a great pitch; and 3) complete data room (information that will let you pass due diligence at the investor’s fund).

Use specialized software to streamline the process of sending out your letters. One powerful automation tool for your LinkedIn outreach efforts is Expandi.io. They promise to enhance your investor reply rate by up to 35% and have special algorithms to help you find the best investors to approach. Another tool to consider in your cold outreach campaign is Lemlist. It boasts a database of 450M+ contacts to populate your contact lists with verified emails, provides you with templates for your letters, and promises to keep your letters out of recipients’ spam folders.

Step 5: Remember, it’s all about relationships

Now that you have talked to your closest circle, revamped your LinkedIn page, compiled your list of leads with all the correct emails, and have your letter templates ready, it’s time to begin the outreach process. But do remember that investors reading your letters are people just like you, and with people it’s all about relationships, and relationships should be nurtured. This is especially true when you are just starting out. Before you send out the letters, do as much as you can to turn your cold outreach into a warm one. To do that, you have to make sure that your name is not completely unknown to the recipient and to offer them some value. Follow their LinkedIn page, react to the content they post, leave comments, collect information about the person — this last one is crucial. Knowing what they post and learning from other sources what they like will help you find the right approach and establish a human relationship. And once you have that, everything’s possible.