I was talking with an aspiring young tech startup entrepreneur last week about getting his one pager together for distribution when somehow or the other the topic of what to do at entrepreneur/investor semi-social mixer came up.
My advice. Don’t pitch, qualify.
Rationale. Raising money is a bit like job hunting. In either instance the most effective way to get somebody to cut you a check is to get to the hidden market. Networking is one of the most effective methods to get to a hidden market. In this instance the hidden market is of angel investors not jobs. Like job hunting, if an entrepreneur is pitching people on giving them money they are going to end up with a bunch of "no’s" and dead ends. An entrepreneur’s objective at a networking event should be to identify potential investors that may help them get to their fundraising goal and arrange follow up meetings with them.
How do you do such a thing as an entrepreneur? Introduce yourself. Don’t pitch. Ask questions. Example:
Budding entrepreneur (BE): Hi, my name is Joe Smoe. What does DoReMi Ventures do? (Never ever ask this question of a venture firm at a formal meeting, it wastes the valuable time that you have in the moment and demosntrates a lack of thoroughness.)
DoReMi: We do seed stage in the online music space.
BE: How did you get involved with that? (Or some other prepared opening line to get them to talk about themselves. Who, what, when, where, why questions all work well.)
DoReMi: {Important background info on the firm/individual, with interesting tidbit or two to help you understand the early stage market.}
BE: Well my firm does (insert one liner here) and; {option 1, if there is a potential fit} I would love to get together with you and get your advice on what we are doing over coffee, or {option 2, and much more likely} would you happen to know anyone who might have an interest in what we are doing?
End of conversation, move on. There is a roomful of people to have this conversation with. Hit them all. Monopolize no one’s time. If there are 40 investors in the room and you spend two minutes with each of them doing this process you have made good use of an hour and a half.
Your objective at industry events should be to qualify. Find two or three angels/VCs to have follow on conversations with about your startup. That’s it. Nothing more.
Don’t pitch, qualify.
You will find yourself getting more out of entrepreneur/investor networking events.
*"Don’t Pitch Me, Bro" copyrighted by Venture Capital Wear.