AngelList is an online community that matches startups with investors to streamline the fundraising process.
I've personally raised $1 million from AngelList for my startup, and have helped dozens of other startups raise $3 million more. I've referred more than 20 startups to AngelList, vouched for a dozen other investors and am ranked as one of the top connectors on the site.
Try a similar strategy by adhering to the following steps.
1. Make It Easy for Investors To Write Checks
AngelList is brilliantly designed to make it easy for investors to write checks to entrepreneurs.
Naval and Nivi, the founders of AngelList, took the very best social mechanics from Facebook, Twitter and LinkedIn to create a "social proof" that ultimately makes investors comfortable writing checks.
Every startup, entrepreneur and investor has a profile similar to a Facebook profile.
Your startup has followers like Twitter, and you can make introductions like on LinkedIn.
Others can comment on your profile, similar to writing on a Facebook wall.
You have a status like Twitter, and when you update it, a notification is sent to all of your followers.
Facebook notifies you when a friend is tagged in a photo; AngelList notifies you when a new investor joins a startup that you follow.
2. Start with the Basics
Create a profile and mark it private. Think of this as your executive summary or one-pager. Use the same tone and style as you would with an investor deck or executive summary. Don't just fill out a few sentences; take a few hours and really polish it up. Don't leave any section blank. A good AngelList profile doesn't fit on one page.
Include numbers. Don't say “100K,” say “100,000.” If you can name drop big customers, do that too -- you want your profile to look impressive.
Focus on traction. How many customers have signed up to your service? How many have been active in the past 30 days? What is your viral coefficient?
Include screenshots of your product, a video walk-through and one or two charts that display traction or revenue. If you have a good video pitch, include that too.
Don't focus on press. Nobody cares that you got covered in TechCrunch, or that The New York Times blog picked up your press release.
3. Find a Good Referrer
Under the "referrer" field on AngelList, you may only list one person. Supposedly, you’re meant to include the person who referred you to AngelList, but you have a bit of liberty here. After all, this is the person who is vouching for you – make it count.
4. Shop It Around to People You Already Know
Add any existing investors or advisers. In general, more is better, but it is possible to have too many. Therefore, only add people who are significant. A good target is two or three advisers who are very relevant to your business.
Be careful when listing an investor as an advisor. Most other investors will immediately wonder, "Why didn't he invest?"
Ask all of the investors you already know to click and request an intro. A good target is to get up to 10 introductions. People are happy to do this -- but you have to take the initiative first.
Ask investors and advisers you trust to leave a positive comment. I would focus on comments from investors, not necessarily other entrepreneurs. A good target is three comments.
Do not create fake intros. People will notice, and it will reflect poorly on you.
5. Use Your AngelList Profile as Your Executive Summary
When someone asks to see your executive summary -- or even your deck -- send them a link to your AngelList profile instead. "See my executive summary online at angel.co/xstartup."
You want investors to go to the AngelList profile instead of passing around your clunky PDF. The AngelList profile never gets stale because you’re able to constantly update the different fields, and your profile will update as new investors come on.
You want investors to go to your AngelList profile because it increases the likelihood that they will interact with it – they can follow you, add an intro or leave a comment. All of these actions increase counters that mark your profile as a hot or trending company. Bottom line, if you’re talking to investors, you want to "get credit for it" on your AngelList profile.
When you're done fundraising, you have the option to "turn off" your profile. Most people won't have saved their own copy. If you really want to be tight-lipped, lock down most of your profile and choose individuals to share with. Then, even if someone leaks your link, most information won’t display to others.
6. Be Responsive
When an investor asks for an intro, try to follow up within hours. Like any "lead," being fast to respond significantly increases your closing rate.
Ready a form letter to personalize and send. Don't make it sound like a form letter, however, but have your reply and supporting documents ready to go.
I use a service like Tout to manage my email templates for quickly replies. Here are some valuable templates you can use.
7. Look for Your Lead Investor
Resist the urge to send out a blast. First you’ll want to find a lead investor -- someone many other investors will recognize and respect. This list of top angel investors is a good start. But look beyond this list as well -- search on AngelList for investors who have made more than one investment in your space in the past 12 months, and who bring some of their own relevant experience.
Many angel investors will be significantly more comfortable if they know another respected investor has blessed the deal. Also, most leads will have their own network of co-investors with whom they can share the deal, but make sure to ask that they share on AngelList too.
I've seen successful blasting work fine for more than one startup, but the best way to stack all the cards in your favor is to line up the lead first.
8. Fill Out the Round
Once you have your lead, now it’s time to open up the floodgates and get your profile in front of more investors.
Start by searching AngelList by market and geography. For example, search for investors who are interested in mobile and also are willing to invest in Austin, Texas. You’ll find 590 of them!
Also, request an intro with anyone who follows your investors, advisors or referrer.
If you don’t see the “request an intro” button for someone, ask investors you know to "share" the deal with them. It’s always best to meet someone through a trusted, third party.
As a last resort, reach out to them elsewhere. Try LinkedIn, Facebook or Twitter. When you make contact, send them a link to your AngelList profile early on in the conversation.
The hottest and best startups get pushed out to all of the AngelList investors by the team that runs AngelList. The best way to get their attention is to follow the other steps I outline above. They will notice when your startup starts "trending," gaining introductions and comments.
9. Keep Your Profile Active and Up-to-Date
Consistently use and update your profile. Don’t let it die, or rust from inactivity.
Think of this as your investor communication. Update your status with Twitter-like short messages to announce progress. Also, update after raising money (like you would keep LinkedIn current, even when you're not searching for a job). That way, when you’re looking to raise another round, your AngelList profile is ready to go with all of the social proof built in from your previous round.
Special thanks to Matt Mireles, Taylor Brooks, Mike Fisher and Bill Boebel for helping with this post.