Fund Your BusinessFinanceSix Ways Startup Owners Can Build Relationships and Network With Potential Investors...

Six Ways Startup Owners Can Build Relationships and Network With Potential Investors Amid COVID-19

The reach of COVID-19 is impacting every facet of the business development process, from small businesses lacking funding to startups getting their footing in an ever-changing economic environment. 

The sobering fact is that COVID-19 will hurt early-stage venture investments, and investors have acknowledged this. A survey by 500 Startups, a top global venture fund, found that the majority of investors they surveyed felt that COVID-19 would have a negative impact on investments in the future. 

What can startup owners do to build relationships with VC investors in this climate? While this is a vastly different landscape, technology has made it easier to be in touch with people who can invest in your business. 

Check out our tips for connecting with potential investors during COVID-19. 

Understand the Current Climate 

To say that things have drastically changed is an understatement. Many VC investors were already sharpening their investment focuses as early-stage funding was slightly lower in 2019 than in 2018, and they will likely continue to do so. As a result, startup owners will have to be creative in their contact approach and show that they have something tangible to offer investors. For you, this means showing that you are spending money effectively, focusing on consumer preferences, and developing innovative ideas that allow your company to stand out in your sector. Understand what investors are looking for and address their requirements. 

Do Your Research 

Much like what you would do if you met investors in person, it is critical that you do your research. If there is a VC firm you are interested in making a connection with, investigate them as much as possible. Look at the sectors they fund, take a look at other companies they have funded, look at their messaging on social media, and see who in your network has connections with this firm. The more information you have, the better your interactions will be. 

Look out for Virtual Networking Events 

Eventbrite and are still active. Professional organizations are still holding virtual networking events. Attend them when you can. You never know when you may come into contact with a potential investor, or someone who has ties to a VC firm you are interested in connecting with. Before you attend, be sure to have a purpose, and go in with a strategy. Some events will even allow you to see who is participating ahead of time, so research who is on the list and use LinkedIn to see the connections they have. 

Use LinkedIn 

LinkedIn is an excellent tool for professionals and business owners. As you are searching for VC firms and individual investors, see who in your network is connected to these individuals. If you have a relationship with the professional, ask if they can introduce you and the investor. This situation could lead to the break you need to communicate with someone who could offer you funding. Also, check out LinkedIn groups like Impact Entrepreneur and Startup and Entrepreneurs Network, both are known to have VC investors and those with connections to VC firms as members. 

Make Messaging Concise and Include a Call to Action 

During this time, you want to show the value you can offer. Look at the sectors VC firms are funding, and show how you can benefit their portfolio through what you do. For example, many VC firms offer funding to technology-based companies. If you are in this sector, you can use the expanding role of remote work to your advantage. 

Acknowledging this transition from the office to working from home, showing the benefits your software or service can have in this climate, and revealing your mission can help you make a mark. At the same time, include a call-to-action that doesn’t put immediate pressure on funding, but allows the investor to follow-up with more information. 

Related: Five Resources and Funding Opportunities for Small Businesses Unable to Receive SBA or PPP Loans

Use Social Media 

Today, there are several ways to get in touch with VC investors. Social media has made communication with these individuals much more straightforward. This is not the place where you want to make the ask. But, you can use social media to build a relationship instead. Comment on postings, retweet/share content, ask meaningful questions about what they do and pass along helpful content that may benefit them. Being on social media allows you to open the lines of communication and create a voice for yourself. So, find out where investors are and reach out to them, you’d be surprised at the impact it could have on acquiring funding down the line. 

Use This Time to Build Your Outreach Strategy to VC Investors

Again, things are different now, but the severity of this outbreak will not always be like it is today. This is the time to make those connections and create a strategy to reach out to individuals who connect with what you do. Many are looking to startups to carry the torch and provide creative solutions to new problems we are facing. VC investors are searching for these companies as well. Show how your product or service is doing this and show how investors can partner with you to make your vision happen. 

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Chanell Turner
Chanell Turner
Chanell Turner is a contributing writer and investigative journalist for ASBN.

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