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(I'm a VC) First step is figuring out how much you need to raise and who the appropriate investors are. If it's tens of thousands or low hundreds of thousands
by lpolovets 7y ago
(I'm a VC)
First step is figuring out how much you need to raise and who the appropriate investors are. If it's tens of thousands or low hundreds of thousands of dollars, that can be from angel investors. If it's closer to a million or more, that's typically seed funds.
Once you figure out whether to target angel investors or seed funds, you can find prospective investors on AngelList, NFX Signal, etc. This selection is based on what sectors investors say they invest in, or if they've invested in companies that are similar to yours but not competitive, etc.
Once you find specific people you want to reach out to, warm intros are the most effective if you happen to know people in common. If you don't, cold emails work if you can write a good email -- but that's a numbers game. You might have to send out 30 or 40 emails to get 5 or 10 replies, but it's a start.
The main thing to keep in mind as you're fundraising is that the further along you are and the more compelling your pitch, the easier it is to get investors. And once you get commitments from the first few angel or fund investors, they will introduce you to many more prospective investors.
- ablekh 7y agoHello Leo, quick question, if you don't mind: do you invest in pre-MVP pre-seed (idea validation phase; deep tech) and pre-revenue seed (MVP-build-in-progress or MVP-ready phase) companies?
- lpolovets 7y agoShort answer is we lean more toward post-launch, but make exceptions. Longer answer is that we typically invest $1m-$1.5m when companies are raising $2m-$5m. Usually that size of round happens after a product is live in the market, but occasionally because of the founders or idea it happens earlier.
- ablekh 7y agoUnderstood. I appreciate your prompt reply and will keep it in mind. Based on the numbers that you shared above, it seems that you typically co-invest, but prefer other VC firms to lead in a seed round. Correct? If so, do you expect to be approached regarding a potential co-investment opportunity only after a lead investor is found and has expressed their commitment to funding?
- lpolovets 7y agoIt's the opposite actually: we try to lead (or co-lead) if someone hasn't signed a term sheet yet, but if they have accepted a term sheet then we're happy to co-invest. $1m-$2m checks are generally enough to lead almost any seed round these days.
- ablekh 7y agoI see. Thank you very much for clarifying. Will reach out to you when the time is right ... :-)