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Helping Entrepreneurs Start Up Since 1996

Or Rather How Not to Approach Them

If you are a marketing specialist looking for a marketing job would you send your resume in response to job postings for high school science teachers or airline pilots? You probably wouldn’t. Just imagine what people would think if you did.

Through this site I receive about ten unsolicited pitches each and every week. One call was from someone two thousand miles away who needed to raise tens of millions of dollars to build an amusement park. The fact that he contacted me demonstrates that he didn’t take any time to read this site beyond the words “venture capital” or find out what my background is.

Using this shotgun strategy to look for investors is a complete waste of everyone’s time. It makes a bad first impression. There is no better way to say, “Hey look at me, I can’t be bothered to do my homework first!” The person on the receiving end will automatically conclude that you 1) have no idea what you are doing and, therefore, 2) are a waste of his or her time.

In the interests of helping you to become more effective in your search for venture capital or angel capital, here are three easy rules to remember.

angel_investor

How to approach angel investors.

1. Investing is a local face-to-face game. There are two reasons for this fact. First, investors like to know who they are dealing with. This means that a series of in-person meetings usually has to take place before they start to warm up to the entrepreneur. Second, if something starts going wrong at a company, the investor wants to be able to drive to its office in under an hour for a meeting with the person in charge. Investors do not want to have to drive all day or hop aboard an airplane for an emergency meeting. They have better things to do with their time.

2. Both venture capitalist and angel investors specialize by industry. These are industries in which they have in-depth experience. Once you find a local investor do some further digging through their website or with a quick telephone call to see if they invest in your type of project. If an investor’s focus is on software it makes no sense to contact them about funding for your new fishing lure.

3. Finally, both venture capital firms and angel investors have a preferred deal size. For some venture capital firms the minimum investment size may be $3 million and the maximum may be $10 million. Venture capital firms can also be broken down into early stage and later stage investors with the vast majority being in the latter group. This means they do not invest in startups (recall the Funding Catch-22). For angel investors the minimum may be $50,000 and the maximum may be $200,000. So, it’s really important to find out before you send an executive summary.

In most cases, you can find the answers to all three questions on the venture capital firm’s website. With a private investor you will have to ask him or , better, people who know him before proceeding with your pitch.

The man who contacted me about the amusement park ignored all three rules. He offered a deal an airplane ride away, in an industry I know nothing about, and in a size outside of my range.

World’s Best Venture Capital Directory (Free)

Why pay for a investor directory when you can use this one or the lists on this website?

15 Responses to How to Approach Investors

  • We need $25K to bridge us through the opening of our new wine retail shop and tasting bar. What’s the best way to find that amount of money on a small time table?

  • Thank you very much for the 3 steps on finding Investors. It was very short, informative but to the point. I will hope to make the right steps in moving forward to my future reality. I have been in the restaurant busyness as a Cook,Chef,Chef owner today for 30 years. I came up with some product line that have not yet reached grocery store shelves. I was approached 14 years ago by an independent broker to put my products in 3000 independent grocery stores.Did not pursue this due at the time i was to busy operating a busy restaurant with homemade products. Since then I have continue to experiment on new products and tested to perfection. I have been approached for the second time with a contract about 8 months ago to put my opportunity in grocery store shelves again. As I work up to 12 to 15 hours a day, I am getting older and ready to get the right helper to make a reality. I need a partner or investor to make it happen. My products are one of a kind that I have been told that i could do a product line in grocery stores. Example: I created a Pizza product that after cooked can be frozen, then microwaved and not turn spongy,doughy,or chewy. It comes out crispy on the outside soft and not wet on the inside. Lots of my guest have shared this with me over and over. I have other products that i have been working on for years with the same great results. I do have a product line that I been told by professionals that I should market these products. I would like your comment from you to let me know to what my next step would be to take.

    Thank you for your time, 🙂 Peter

  • We Susan and Allen farque, have our company, Trinity Farque Industries, LLC. We have an invention, called the Heavy Haul Wilderness Wagon, which one may see on our website. This is the most unique universal utility trailer ever designed for the outdoors and general public. It has taken 7 years of our time and $25,000 of our savings to get to this in time. We have a complete marketing analysis, along with a world wide research on our invention. Personally we have done much research on our own, besides our marketing analysis and it has been awesome. Here is an idea of what our invention is and can do. It is a portable hunting blind, with zipper openings all around the trailer. It has portable removal seats, covered by camouflage, and even the crippled may use this trailer with ease. It is a sleeper if needed, a work trailer and can carry up too 500 plus pounds, of whatever maybe needed. It has front wheel disc brakes, overload springs, for strength, wide track wheel base to keep vehicle up right, can be pulled by anything with a trailer hitch, at high speeds. Our analysis says in less than two years this trailer would be a huge success. Our tele. no. 337-855-7438, as we are than happy to speak with anyone that maybe interested, thanks.

  • Dear Sir/Madam
    I am Mukasa David from Uganda East Africa and i am looking for funders, partners (Investors) Lenders who would be interested in investing/Lending capital to a project of a residential city set on one square mile with about 600 houses a school, hospital,shopping mall,urban roads and green park in Africa, with your humble interest you will be giving a chance for the world to be a better place to live, i will be glad to have your positive response,thanks

    Regards

    Mukasa David

    Kampala Uganda

    +256774060427

  • Dear Sir/Madam:

    Greeting and Good Day-I am seeking out informed contributors to the actual upstart of Global Ship Registry Processors LLC an already formed entity. This for which would deal in the day-to-day administration of a “flag of convenience”-or open, registry for a certain emerging nation. If there is even a modicum of please contact me at the given email address.

  • This will revolutionize everyone’s ability to save money.I have created a way to teach children and adults how to put away money without able to get to it. its a portable safe for your home. My utilities patent was granted in July 2014. I am looking for an angel investor who wants to make history with me.

  • Great advice, but try to find someone who wants to invest in something which is not a tech or online venture.
    If you say you have an idea for an app, people starting pulling out their wallets, hoping to discover the next facebook. They completely ignore companies that are much saver and will easily give them a 500% ROI, but greed seems to dominate venture capitalist at the moment.

  • Recycling Consultant, providing Technical user defined support with on Floor solutions with implementation to prove its VALUE ADDITION + ROI = SAVINGS.
    Industries Catering to:-
    1. Aluminium Scarp recycling Projects.
    2. Plastic Scrap recycling Projects.
    3. Reduction of Pollution in Melting Cum
    Holding Furnaces during operation.
    4. Re Vamping / Upgradation of Running
    Units.
    5. New innovative Concepts for Onging /
    Expansion Projects and facilities.
    For further detailing, discussuons and prospects, pl. revert through Mail or Contact over Mobile phone / SMS or through Social Media suiting to individual preferance.

    Regards

    Rajiv K Gupta
    +919654406636 / 42

  • our company is going to start a new portal named as MOBILEKARD.
    which helps everyone in creating there own digital cards.
    the concept is new and in basic desire by people now a days,.
    we are looking for an investor partner who can invest in our portal so as to take it on a new height..

    please contact at mobilekardmarketing.com

  • I have a 20 acres of land and planing to get into farming. It is located in the central region part of the country which is very conducive for agriculture. I am opened for discussion and very interested in pineapple and tomatoe farming . I want an open minded long term investor who is willing to meet for a face to face meeting with me and my wife. I am based in the US(New York) contact: +1347-891-4370

  • We are Men Leather shoe manufacturing factory located in Sri Lanka. We can make leather shoes as per required designs world wide .
    We are looking for investor / shoe buyers / Partner / shoe wholesale distributor’s to work with us for long term relationship .

    Any interested parties please contact us for further details .
    Thanks & Regards
    G.M.Perera

  • If you’re going to ask for money, at least proof read your comment before hitting “post comment”.

    I don’t even have money, and I don’t want to give it to any of you.

    People are dumb.

  • Sir we are running Educational Classes we want to expand…..

  • We have 4 available registered small scale mining gold concession for
    sale in Ghana at Ashante , Eastern and Western Region.

    However, Geological Tests show a large amount of Gold Deposit in the concession.

    There are no political, financial or environmental encumbrances.The
    area has a long placer gold mining history and local residents are
    very supportive of mining. Good security measures tailored to protect
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    All documents covering the mining concession are available for your
    perusal and cross checking of Site Plan, Land Title Deeds,
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    Any interested buyer must send letter of interest LOI which needed to
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    Please no chain brokers.

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