Building Your VC Network
Originally posted on 9/4/19
Collin Gutman is a Co-Founder and Partner at SaaS Ventures, with over a decade of cumulative experience as both an investor and a startup founder. Prior to founding SaaS Ventures, Collin co-founded Acceleprise, the world’s first pure enterprise tech accelerator. Collin also has been an entrepreneur, having founded WorkAmerica, a social impact workforce development startup. Collin holds a BA cum laude from Yale University, and is an avid DC sports fan.
There are lots of great venture funds. If you have a good business, chances are one is the right fit for you. However, you’ve got a limited network, and it’s probably not made up of VCs. Most of the people you know are potential customers, hires, advisors, etc, not professional investors. So how do you get to the right investor with a thin network?
Great question. The answer lies in VC networks. While you may have very few VCs on speed dial, check the LinkedIn for any VC you know — chances are they’ve got more than a few VCs in their network. If I don’t know a specific fund, I likely have a second degree connection and could get an intro to that fund — that’s how small the venture world is for a VC.
So start with something close to you. Know of a few funds that focus on your sector (healthcare, retail, etc)? Try to get in touch with their associates. While they can’t pull the trigger on an investment and their fund might not even be the right fit in terms of stage, if you’re upfront that you’re a little early for them but looking for guidance as to the space, you’re likely to get a response. VCs love to get to know companies that aren’t formally pitching yet. Otherwise, go local. You’ve likely got a co-working space, accelerator, or something of the sort near you. VCs probably have an office or office hours there. Try to schedule time through that venue. Again, VCs love to get to know new companies, and know lots of other VCs. If you’re a humble, hardworking entrepreneur looking to meet the right fund (and that’s your pitch, not, please invest in me even if I’m a poor fit), your odds of getting passed along with a warm referral are high. Those referrals are highly valued by VCs.
So maybe there’s one fund out of the thousands in the US that’s the perfect fit. Maybe you don’t know anyone there, let alone which fund that would be, but chances are that one meeting will lead to three more, will lead to three more, and so forth, until magic happens. VCs love to trade deals with great entrepreneurs, it’s our only currency with entrepreneurs and each other (when we don’t do a deal). So use that to your advantage. You never know where one conversation can lead.