Get VCs to Reach Out to You (2024)

FAQs

Get VCs to Reach Out to You? ›

“The hands down best way to introduce yourself to a VC is through a mutual connection, so always try that first. Either connect on LinkedIn, mention your shared contact, or best yet, get a warm introduction from your friend or another member of the investment firm.”

You can do this by reaching out to VCs through warm introductions, referrals, or mutual connections. You can also network with other founders, mentors, advisors, and influencers who can vouch for you or introduce you to VCs.

A good technique to get in touch with a VC is through referrals of investors. Meeting other VCs through fellow investors can be the ideal introduction, especially if they are eager to join your investment round as well.

Network. It's very unlikely that you'll run into a VC by chance or sheer luck. You'll need to build your professional network and leverage your connections to get a proper introduction. Venture Capitalists rarely go outside their own personal network to find clients and tend to operate solely on referrals.

If your startup is a good potential investment, the VC will make sure you know. In fact, when a VC is interested in making an investment, the VC will act a lot like that Porsche salesman. In other words, the VC isn't going to let you out the door without trying to make a compelling sales pitch.

The Odds of Succeeding for a Startup Funded by a Top VC

Since there are 4,000 companies looking for funding, that translates to odds of 5.0%. Of the 200 that are funded by top VCs, 15 of those startups will generate nearly all of the economic return.

The pitch should include a strong value proposition, a detailed explanation of your product or service, your target market, your revenue model, and your competitive advantage. Include the key financial metrics that show the financial health of your business. Those metrics include such factors as: revenue growth rate.

Venture capital is absurdly hard to secure.

Stories of startups that raised VC funding seem to dominate financial headlines, but in reality only about five in 10,000 startup businesses receive venture funding — less than 0.05%, according to Fundera.

How do you approach venture capitalists? ›

The most commonly known way is by startup applications and referrals. However, VCs also have tools to find relevant startups featured in the media or social media. If they are interested, they will reach out to see when the startup will be fundraising and build a relationship to ensure they can be part of the deal.

VCs will want to know what milestones — particularly those related to growth and revenue — you will hit and when. If your startup has no immediate plan for revenue, say, because product development will take time, you should be ready to list other benchmarks you will achieve in lieu of revenue.

If your company is ready to raise a Seed round, then this may be your first time approaching VCs. Seed-stage VC firms come into play when you are raising $500K to $5M in your first outside round. To justify that size of check, most VCs do want to dig into the idea, look at prototypes, and see a detailed business plan.

Find a way in.

Referrals from trusted connections are the best source of deal flow for VCs and opportunities that come through this channel are much more likely to be given a first meeting. It makes sense to put a good deal of effort into this approach to maximise your chances.