Build Your VC Investor List [in 3 Simple Steps]

Time & again I ask founders “do you know who you’re going to be approaching for your upcoming raise?”

And I get blank faces, or some vague answer that amounts to a few Friends & Family + a couple of VCs.

Unfortunately, most founders either skip the shortlist (because they’re overconfident) or try to find investors while they’re going through the round (because they think they can build the airplane while flying it).

Those people end up not raising.

If it’s your first time, your potential investor shortlist should include at least 100 well-researched names.

Skip the intentional shortlist build, and you’re sunk with:

• Wasted meetings
• 1000+ useless DMs that lead nowhere
• Constantly getting ghosted
• Struggling to get investor commitments - because no one will listen

But there’s hope. Today we’re going to build your initial shortlist.

Here's the step-by-step rundown:

Step 1: Choose your platform & set your criteria

There’s tons of platforms you could use - I prefer OpenVC (use code EVAN20 to get 20% off forever), but any other is fine.

We covered identifying your perfect-fit investors in a previous newsletter.

Set your initial search criteria, including:

• Geography
• Industry
• Stage
• Check Size / Round Size

Step 2: Initial searching & adding

With initial filters set, you should be whittling it down to ~500 or so names, and adding more criteria.

Test adding additional search filters to get down to the ~100 mark, then do a quick sanity check on a few of the names that remain:

• Does it actually seem like a potentially decent fit?
• Is the company specific enough?

If you’re scratching your head like “umm not exactly” then you’ve probably taken a wrong turn & need to go back.

Once you feel pretty comfortable, start adding good names to your shortlist.

You’ll want to keep certain details for later, such as:

• Status
• Last Outreach

If you’ve got OpenVC, most of this will be tracked for you.

Step 3: Wild cards

This is the weird / potentially convoluted part where creative thinking is incredibly valuable.

Search won’t uncover everyone who would love to invest in your business, but food for thought:

1. Exited But Want Back In: VC that invested in a big competitor when they were at your stage, and subsequently exited (IPO / sold company). It might have been years ago, but I’ll bet you the knowledge is still there. The VC invested for a reason (& hopefully made $); maybe they’d invest again - in you this time.
2. Left Out Last Time: Have a competitor in your industry that raised BIG money from one or multiple highly-visible Tier 1 VCs? Then for every VC that invested there are probably 10-40 others that heard the pitch (& maybe wanted to invest) but got edged out by VC that finally invested. Your job: find the ones that wanted to invest, but weren’t given a shot. VC is an old boys’ club.

There’s no silver bullet to this but for #2, let’s say you have a bigger, well-funded competitor ABC Company. ABC is now at Series C, and you’re approaching your Seed.

You look at ABC’s Seed and see Bessemer Ventures invested.

That could mean that ABC turned down 10 other VCs’ termsheets so that Bessemer could have the entire round.

Find the 10 that ABC turned down and you might have some serious potential interest.

There’s more strategies like this (I might cover them all in a mini-course), but #1 and #2 should get you started.

Summary

You’re not after 1,000 potential investors.

Aim for a good starter list: generally about 100 names long.

From there, your next steps are going to be:

• Vet the list
• Prioritize
• Prep
• Strategically start approaching

Next week we’ll talk about approach tactics.

Hope this was valuable for you!

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