Red flags in emails to angel investors
gabrielweinberg.com
gabrielweinberg.com
"A related red flag is asking me a question or mentioning something that I've obviously addressed in a blog post."
This is a red flag for me from the other side. It comes off as out-of-touch to assume that because I want investment from you I will read through your entire blog. I'm sure there's quality information there but reading every post is not a high-value thing to do with my time as an entrepreneur.
Don't make me leave my mail client, don't send me long emails, don't make me work to find your Twitter/LinkedIn, don't message me if you're not my target demographic BUT don't get someone to make an introduction for you, make sure you've got your MVP demo-able, make sure you've read everything in my blog (and from the comments here, don't ask questions and expect a personal answer).
Given the primary thing you want from an angel is time (which is another way of saying that the most valuable trait of an angel is their experience), this seems like an odd way to market oneself.
So these tips are more about getting noticed. It's really just advice. If you don't do them will you be completely thrown out? No. I read pretty much everything and give it serious thought. But if you don't do them you're not putting your best foot forward.
I also don't think I'm alone here, though I'm of course not speaking for anyone but myself. I suspect that if you did all these things you'd have a much higher conversion ratio, which ultimately will just save you a tremendous amount of time.
An angel is looking for people with hustle. Someone with hustle will find a way to email me. Not blast me on twitter (along with 35 other people all at the same time.)
"Make sure you have a working demo" is a pretty reasonable cutoff, don't you think?
As a known angel, you get inundated with requests; you have to develop a bunch of quick ways to throw out the majority of incoming traffic or you drown.
Not interested in [...] anything involving physical products.
"Not interested in [x, y, z, just a, b, or] anything involving physical products"
Often this is a numbers game. Try lots of investors as each are at different stages (some have the readies, some may not be interested in your sector, etc)
I just wish he accepted Canadians in his investment pool. Not that I'm even looking for investment or anything, but if I was I'd be nice having someone that actually gets machine learning and big data from the ground level.
It's worth a valuation significantly less (say half to a third) since the insights he would give and the types of connections he would have (and knowing the difference between which of whom to introduce since he gets the space) would be phenomenal.
Dropping blog posts etc just seems very superficial...and actually saying how they'd be the person to help you just makes you come off as needy.
Multiply that by 30-40 people, and it's no wonder it takes people months to raise funds.
It doesn't have to be long or superficial, though that pre-supposes you do sincerely need help with Y. If you're just looking for money, then that may not be the case. But in that situation, I'm probably not the right angel investor.
Better spec that I own an iPhone and use Foursquare while you're making a list of obnoxious requirements. Uh oh, I don't even have a Pinterest account yet!
The proper response to an angel that red flags on something like that is: sorry, I'm too busy doing actual work to worry about whether my Twitter account is existent and up-to-date, I'm going to pass on allowing you to invest into my company.
I don't have the time to tweet several dozen times per day (what it would really take to learn anything meaningful about me @140 characters a shot). Period. It's not worth the time trade. Should I be tweeting so I can have a couple thousand followers (half of which are literally worthless)? Or should I be throwing that hour a day into my business?
I could give you a simple bio that would be far more concise and useful than what you could possibly extract from Twitter postings. And, you don't like wasting your time either: if you have to scan my Twitter posts to compile a picture of me, you're going to waste a huge amount of time I could save you with that simple bio.
When trying to get an idea of what someone is like, flicking through their Twitter / LinkedIn / HN posts is far more informative and reliable (and quicker) than reading a bunch of prose they wrote about themselves.
I don't believe Twitter qualifies as a valuable form of due diligence for an investor. Should Zuckerberg be worried about what Wall Street thinks of his Twitter account? One post in three years probably implies he just isn't with the times.
It's not looking good for Zuck.
You know what's a lot more reliable than me tweeting about Whitney Houston's death? The product I create and show you. Brass tacks. The rest is a superficial sideshow.
I don't believe Twitter qualifies as a valuable form of due diligence for an investor
No disrespect, but you're belief is incorrect. Anything and everything about you online is used when doing DD. Of course, if your product is fucking awesome, then the fact that your Twitter stream is empty is irrelevant. But if your product is fucking awesome, you aren't cold-calling VCs. VCs are cold-calling you.
Having what, for all intents and purposes, is an employer judge - or worse yet misjudge- me based on my interests, or the articles I read is precisely the reason I'm moving away the merger of my online/offline lives. I recently put my money where my mouth is and deleted my Facebook account.
>"However, at the seed stage you're investing in people"
This always sounds like horseshit to me. Can some one point to some good examples where this model has been truly successful? Why aren't VCs actively recruiting college campuses, then? It seems like you're missing out on a huge chunk of great candidates if you're always selecting "people" from a small subset who are seeking funding for their (possibly terrible) technology startup.
I don't know everything about these incubators, but are you telling me that these guys and gals apply and get into the programs without an idea for a startup? That isn't how I thought it worked. I think that's how people like to think or claim it works. But I'm not sure it's the reality.
And, if I tried hard, I could probably come up with an example or two where the opposite happened: VCs banked on the talent behind a company with a not-so-good idea, and it "failed".
I don't see anything that indicates my belief is incorrect. Quite the opposite, I'm living proof that I'm right.
My Twitter account doesn't have a single post on it. I deleted the 20 or 30 tweets it used to have dating back several years. My Facebook account is completely private. My LinkedIn account lists only my current project.
I raised the seed round for my latest venture, from a world class investor (a top 50 investor in the US tech market), with a demonstrated product, and absolutely nothing else. My product was solid, but not "fucking awesome" - it was good enough to prove I could execute the rest of the plan. It took about two months to build, and a net cost basis of maybe $50 if you proportion out the real infrastructure expense. The bottom line: I sold the investor on what I was going to do, how I was going to do it, and I had a good enough product to demonstrate credibility.
Obviously, Wall Street !== Angels, ergo IPO !== seed stage.
There's no doubt there are edge cases. But the point I was trying to make was that investors are interested, above all, in people. The fact that you managed to raise a seed round in the absence of traction or a polished product is evidence of this very point. I'd love to hear from your investor as to why he invested in you. I'm willing to bet you are the single biggest reason.