I fund young companies. I’ve funded companies that everyone has wanted to fund, and companies that not many people had heard of yet. I’ve funded men and women, first time founders and repeat founders. Enterprise ventures and consumer businesses. Entrepreneurs I’ve met via mutual friends and ones who were a cold email into my inbox. Outside of founder integrity, I have very few absolutes about the attributes of the people and company that will be our next investment. But I’m skeptical I will EVER write a seed check to a company that reaches out to me via a banker or placement agent.
At the seed stage there are just some things you can’t outsource and fundraising is one of them. Having a banker or advisor behind the scenes helping you understand the venture process? Maybe (although there’s so much more info out there these days than 10 years ago). But having this person approach me with an “I’m representing Company XYZ which is looking for funding” email? Not the way to start off our relationship.
You don’t need an intermediary. You need to be out there building relationships with potential investors. You need to understand how to tell your story, to get someone to believe in you. Failure to do this well doesn’t just impact fundraising – it’s the same for hiring, for press, for partners. So founders, please send the email directly to me – preferably with a link to a product demo instead of a 60 page business plan.
* Remember, I’m talking about seed stage financing. As rounds get bigger, more complex, I understand the participation and leadership of bankers and advisors.
** A lawyer making an intro during fundraising is different. You’re hiring that lawyer anyway to manage your legal needs around incorporation, financing, and so on. Good startup lawyers also have relationships with investors that can help with an introduction. But don’t hire a lawyer because you think he or she can get you financed. YOU are the only one who can get yourself financed.
*** I wouldn’t even have a business consultant portray themselves as an employee of your company that’s managing the fundraising. Again, founders founders founders. The more layers put between me and the founders, the less happy I am. And this isn’t asymmetrical – we currently don’t have any investment professionals at Homebrew who can’t bring a deal to the table for funding (it’s me and Satya).