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It’s not that going in cold to a venture capital fund is bad, it’s that most cold emails are poorly put together in the first place.
Whether it’s the info@ email, a form submission, or cold emailing investors directly, there are usually a number of routes to get in touch with investors without needing a warm intro or mutual connection. However, if you want good response rates from your cold email outreach, then you’ll have to do some groundwork, and follow three key tenets.
Investors spend a huge portion of their day trawling through their inbox (that’s why VCs have so much love for companies like Superhuman). Between incoming pitch decks, portfolio companies, general admin and meeting coordination, there’s a lot going on. As someone sending a cold email into this system, you have to remember you’re dropping into that maelstrom – incognito.
A function of being busy is learning to assess and prioritise tasks and opportunities efficiently. For example, you can often figure out how important (or not) an email is simply by looking at the subject line, and you can definitely prioritise from the first three sentences. When drafting your initial email, remember this: it’s not that people get bored, it’s that priorities are set quickly and you need to signal – from the offset – why you should be a big one.
The more closely suited to someone’s preferences an opportunity is, the more likely they are to dedicate time to it (this feels obvious – but, based on my experience, it’s anything but). This is why looking through investment opportunities is kind of like browsing Netflix – there’s definitely good stuff on there and the odd trailer might catch your eye, but at the end of the day you like Tom Hanks, so you end up watching Castaway for the third time (or you end up investing in another e-scooter company).
Before you write a cold pitch, DO YOUR PREP
Top Tip! We’re not being paid by Crunchbase – but if you’re running a venture-backed startup then a subscription to Crunchbase Pro ($360 for the year) is well worth it for sourcing potential investors.
You can quickly run a search of venture capital firms that have invested at your stage, in your geography and in your sector in the past 24 months, and get a detailed list with partner details (including their contact information), angels who participated in the round, and more.
CB Search: London Based Investors, Invested in a Seed round with a cheque of $500k-1M, in a London based company, in the past 18 months.
Is there a relevant or complementary company in the VC’s portfolio?
The magic of Crunchbase allows you to see the fund’s recent investments, and look for any relevant or complementary companies in their portfolio. This can give you a contextual nudge to place in your email body that will further intrigue the investor and show them you’re someone who actually does their research.
Junior investors (depending on the fund) are super thirsty for deal flow. They also have a surprising amount of knowledge when it comes to shepherding deals through the labyrinthine process that is a venture fund partnership’s decision-making apparatus.
So, first figure out which is the right investor in a fund for you to target. Do not email multiple people; it creates a weird dynamic in a fund where people wait for the other person to run with it. Find the person in the fund you think is most relevant and accessible to you. If you go for a Partner and they don’t reply, follow-up with their Associate. It’s more likely that the partner is busy rather than ignoring you because they are uninterested.
You can just email email@example.com to throw your hat into the ring. That said, many VC investors don’t read their cold email (their loss) – so your best bet is to examine your target list of individuals and have a hunt around for their direct email (their website and personal Linkedin / Twitter accounts are a good place to start). If that fails, take a stab at guessing it. There is a strong chance it’s one of the below:
Once you’ve completed all of the above, start drafting your email. This isn’t a manuscript to spend hours on. It’s a quick, simple message. There are, of course, some basic dos and don’ts.
Once you’ve sent the first email, rinse and repeat for your next VC target – successful startups have a 30/1 first-meeting-to-term-sheet ratio, so you’ll need a stacked funnel of investors to have a high likelihood of raising.
If you don’t hear back within a week, then you should absolutely send a follow-up email. Sometimes emails get missed or sent to spam filters, but most good investors will give you some sort of response. Your goal is to get them to set up a time to speak.
Frontline’s investment into digital design software, Modulz, came about from a cold email. Founder Colm Tuite’s original email is pretty much as great an effort as you can find.
Modulz recently announced their total funding of $4.2m
This email resulted in us leading a $1m+ pre-seed round into the company. As far as cold emails go, it is clear, intriguing and allows me to easily do some additional research and get bought into the company, without having to actually speak to the founder.
It’s made even better by the fact that, in a subsequent email exchange, the founder mentioned he was also chatting to two other competitive seed funds, one of whom we had recently lost out to on investing in a company we really liked. FOMO is real folks – it’s on you to harness it wisely.
By the time Colm and I actually spoke, I was already very excited about the company.
Cold outreach isn’t easy, and the hit rates will definitely be lower than via warm introductions. But if there’s one thing I’ve learned from reading thousands of cold emails, it’s that the reason most fail isn’t because they’re cold, it’s because they are just plain bad. Put some effort into it, I guarantee it’ll pay dividends.
P.S. Much of the above can be modified for cold emailing anyone – don’t just try it with VCs! New customers, potential hires and great partners can all be sourced through a well written email sent to the right target audience at the right time.
If you’re raising funds for an early stage b2b software company, hit us up ice cold.