The “socially distant party round” has become the hot financing vehicle of 2020!! Managing a cap table with...

Accelerators
Angels
Pre-seed/Seed/Seed extension(s) VCs
“Solo capitalists”

...can be a challenge.

Some thoughts on how to maximize ROI:
1/20

Small investors are no longer tourists – instead, they’re a meaningful part of the ecosystem.

Most VCs like me want help – it takes a village!

The trick is knowing what to ask for, from whom, and how.

2/20

Step One: Keep you investors updated

Big cap tables often come with impressive networks. More investors = more nodes in your network.

But in order to capture that value, you MUST keep your investors up-to-date! It can be via email (~80% in my case) or text/calls (20%). 3/20

Up-to-date investors can help you hire

Talent networks are the most valuable recruiting pool you can access. To take advantage of them, investors need to know what you’re looking for. They also need ammunition to sell the prospective role. Give it to them!

4/20

Up-to-date investors can help fundraise

Investors can often kickstart a hype cycle by talking about your startup with their peers. It’s easier to start a whisper campaign/incite a pre-emptive round if your current investors know the state of your business.

5/20

Here’s a fill-in-the-blank template you can use:
https://medium.com/hackernoon/a-fill-in-the-blank-investor-update-template-for-busy-founders-d431c227347b

Now let’s move on to what you should ask for and how to ask for it.

6/20

Repeat yourself...Repeat yourself...

Remind everyone of your mission/vision in every message. Even if they’ve been investors for a long time, share it again. Include it at the beginning of each update email. It's old news to you, but a good reminder for investors.

7/20

Make your asks specific

Don't make unformed asks like, “Do you know anyone in product at Google?”

The smarter play is to send the LinkedIn profile of someone you’re looking to connect with, and asking your investors if they have any connections in common.

8/20

Know your investor's superpowers

When you’re grappling with a challenging product issue, ping the former founder, not the quant jock. Likewise, when you have a question about an arcane debt issue, ask the investors with the most relevant and domain expertise.

9/20

Signal boosting

Investors often have large followings–some angels are legit celebrities–and can help spread the word about your startup in ways your organic channels can’t. Asking your backers to broadcast a message is one of the easier asks.

10/20

Make your asks turnkey

Don’t send a link and ask your investor to tweet it. Write the tweet for them, include any links/tags/attachments you want circulated. Let them customize it, but 99% of the time your version will be superior to whatever they’ll write.

11/20

Deck review

When you go out to raise a new round, you should test your new pitch and updated deck on your existing investors. VCs & angels are more up-to-date on what is happening in the market and know which aspects of your story will garner the most interest/concern.

12/20

Exec Interviews

It’s helpful to have a roster of investors to meet with potential key executive hires. Investors know more startup CXOs than anyone and can help give you a fresh perspective on how your preferred candidate stacks up to the field.

13/20

Press outreach

Most angels and VCs have cultivated some contacts in the media. When the time comes, ask them for warm introductions. Again, ask for specific intros to specific reporters, not a blanket ask for “help with press.”

14/20

Pick your targets

Don't ask for intros to dozens of people – potential hires, media, customers, etc. – in a single email. Investors are high leverage tools, not inside sales teams and you'll get better results if you ask for five tight intros rather than 50 broad ones.
15/20

Keep leveling up

In the early days, It’s good to update your investors when you’ve closed your first account, or broken a minor consumer milestone. After a couple of years, it’s important to focus attention on news that moves the needle.

16/20

BCC everyone, or expect help from no one

This is good email etiquette, but more importantly, if you ask everyone for help, no one will feel obligated. Some VCs are intimidated by having to respond to a list of dozens of their peers. If it’s <6, it’s okay to CC.

17/20

Be responsive

If one of your investors flags an idea or a person to connect with, it’s important to respond. Be direct but always best to show that you acknowledge the help, even if it’s not spot-on. Sometimes investors just need a little direction.

18/20

Strategic guidance (and therapy!)

Everyone is going to have an opinion about your startup – often biased and counterproductive. Find one or two smallish investors on the cap table who will just hear you out. All founders need outside sounding boards.

19/20

No single investor will have all the answers, but the beauty of a diverse group is that you can configure a dream team of different skills/backgrounds/personalities.

Your cap table can be more powerful than just a bunch of cells in a spreadsheet – or Carta. Use it well!

20/End