December 19, 2015
There have never been more opportunities for entrepreneurs to get funding for their new startups. That doesn’t mean, however, that it has made it easy. One platform that is helping change the investing game is AngelList.
I’d been trying to get one of my startups featured on AngelList for a long time. I first tried in 2011 with a previous company and I got my first rejection. At the time, I lived in the same condo complex as AngelList’s headquarters. Their office looked down on a small piece of land that was only accessible from the unit I lived in. Every day while I took my dog out I could see the AngelList team working hard and I was reminded that my company wasn’t good enough to be seen on their site – even though they saw me every day.
The AngelList model has changed significantly from when I first tried to get featured 5 years ago. These days, the best way to raise money is through a syndicate.
In May, when Bliss first started efforts toward raising a seed round, I wanted AngelList to be part of the overall fundraising strategy. After a ton of due diligence we ended up going through the personal syndicate of Kyle York, avid angel investor and chief strategy officer of Internet performance company Dyn. Kyle understands SaaS and got what we are trying to do as a company.
Kyle’s syndicate was brand new – which was both a blessing and a curse. One potential downfall of being the first deal through a syndicate is that it might not be mature enough to drive a lot of investors into the deal. With that comes more grassroots efforts to drive awareness – which is okay, because being the first also means that everyone is hungry.
Through a ton of hard work, personal emails and a little bit of luck we were able to have these results:
- $268,000 raised from 57 investors through Kyle York’s syndicate.
- $140,000 from 4 investors with a direct investment in our seed round.
While raising this amount of money in a short time may seem easy to most, keep in mind that it took me 5 years to get featured on AngelList and more than 5 months to convince Kyle to invest in Bliss through his syndicate.
For most founders (including me), raising money on AngelList is not an easy task. Just like fundraising in general, you need a great story, team, and proven traction to have a chance at a successful fund raise. You also need perseverance and a bit of luck. But if you follow some of these tips you can, perhaps, increase your luck:
Choose a Great Syndicate Lead
Kyle was simply awesome. He spent a ton of time before the launch of the Bliss syndicate getting investors excited about the deal, relentlessly hustling during the deal and was thorough in understanding our business (5+ months of due diligence!).
I always prefer to do video chats over voice calls — you get to know the person better.
Be Responsive and Thoughtful on Communication
I made it a point to respond to all inbound interest quickly (same day) and I personalized all correspondence (by researching each person). Additionally, I made myself available to potential investors. I always prefer to do video chats over voice calls — you get to know the person better. This paid off — literally!
Fill Out Your AngelList Profile as Thoroughly as Possible
From the first day we launched Bliss, in March of this year, I’ve kept our profile up to date with complete details on our company, multiple screen shots of our product, new hires, revenue, etc. This saved me a lot of time when our syndicate got approved by AngelList, as all of our company information was up to date.
Close the Syndicate as Quickly as Possible
Most of the momentum will happen in the first couple days, so wrap it up in short manner and get back to work! The Bliss syndicate was open for two weeks and it felt too long. If I were to do it over again I’d aim for one week.
Be Prepared for “No” – and a Lot of Them
Most of my personal contacts said no and the reality is, most of yours will, too. Don’t get discouraged. Fight through the adversity. Persevere!
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