Making your pitch is just the beginning. Too many entrepreneurs squander the investor interest they generate by botching the follow-up. Here are four simple steps you can take that can make the difference between an oversubscribed round and abject failure.

A few rare pitches generate an immediate investment. Tweet This Quote

As an angel investor, I see hundreds of pitches per year. Most are rejected immediately. A few rare pitches generate an immediate investment (usually they involve a long-time friend with a killer product offering an investor-friendly valuation). But the challenge lies in the pitches that intrigue me without convincing me.

How entrepreneurs manage the fundraising process can have a major impact on whether or not they receive an investment. It may seem like blocking and tackling, but managing the fundraising process appropriately can be the difference between an oversubscribed round and abject failure.
The key, as always, is to consider the mindset of your customer—in this case, the potential investor.

1) The reason we haven’t invested is that we’re uncertain. Your job is to remove that uncertainty.

Potential investors are uncertain by definition—if they were certain, they’d say “yes” or “no,” because none of us enjoy keeping entrepreneurs dangling.

Instead of asking, “What will it take for you to invest?” which puts us investors on the spot, ask, “What are you uncertain about in my deal?” This will identify the problem areas you need to work on. It won’t identify the solution, but the investor probably can’t tell you the solution either.

2) We’re busy. Don’t make us chase you. Stay in touch without being pushy.

If you wait for potential investors to call you back, you’re going to be waiting a long time. Even a part-time investor like me might be talking with 30-40 entrepreneurs at any given time, and the situation is an order of magnitude worse for full-time investors like VCs.

Investors are ruthless with their time; if a deal is hot, they’ll chase it. If not, they’ll wait for the entrepreneur to make the next move. That means in most cases, you need to take matters into your own hands.

Investors are ruthless with their time.  Tweet This Quote

I advise entrepreneurs to view investor relations as drip marketing—your goal is to keep touching your target market until it buys. The best way to do this is to send regular email updates. I’ve always advocated bi-weekly updates—weekly updates are too frequent; monthly updates are too diffuse.

Your update should convey what’s happened in your business – relate what you’ve learned, and ask for opportunities to receive help with advice or introductions. The goal is to provide enough information for investors to talk themselves into your deal.

Investors don’t like making decisions based on snapshots; they prefer having enough data to extrapolate with confidence. Your updates should provide that data, including key information like registered users, engagement, and yes, even revenues.

Keep your updates to the point. This is not your opportunity to philosophize or relate amusing anecdotes. Save those for the fanboys who will someday devour your company blog when you’re rich and successful. If you don’t deliver crunchy numbers and insights in the first paragraph, investors won’t bother reading on.

You don’t need any special software; a simple BCC to a list of email addresses will do, though if you want to use a mailing list software or CRM, that’s fine too.

3) When we signal that we want to engage, engage.

As you send your regular updates, certain investors will write back with suggestions, offers to help, etc. That’s a sign that they’re interested. Investors don’t waste time to be polite; if they write anything beyond, “Thanks for the update, keep me apprised of your continued progress,” that means you’ve got their attention.

Follow up immediately. If they have suggestions, ask follow-up questions and offer to stop by their office. If they offer to help, give them whatever they need (this often takes the form of an email that they can forward to someone else).

Investors rightly assume that if you won’t follow up with them, you won’t follow up with your customers either. How well you engage them serves as a proxy for your ability to sell to customers.

4) Ask for our money. Then take it.

Once you’ve engaged your potential investors and have had a successful interaction, ask for the money. Don’t assume that the goodwill you’ve built is cumulative. Remember, investors are busy. There’s no guarantee that they’ll feel the same about you a month from now.

This means you need to be ready. You need to be incorporated and working with a name-brand law firm (or an attorney who is an alum of a name-brand law firm). You need to know if you’re talking with a lead investor or not. For lead investors, you need to know what terms you’ll agree to. For other investors, you need to have standard investment documents they can sign (such as a convertible note). Don’t forget to set up a bank account—due diligence isn’t done until you cash the check.

Once someone has agreed to invest, redouble your efforts. Get them the required documents, and ping them daily until they’ve signed them. If you have to, drive to their office with the required paperwork. They could change their mind at any second.

An Unreasonable Challenge:

Making a successful pitch is the beginning of the investment process, not the end. Smart entrepreneurs execute the fundraising process with the same tenacity they use to sell their product. If you have already begun the fundraising process, your Unreasonable Challenge is to write and send your first investor update.


Update: I wish I’d mentioned one of the most important principles of investor relations—start developing your relationship with investors before you need their money. Think about the friends in your life who only call you when they need something. How do you feel about them? Exactly. Strike up relationships with investors you respect before you even have a company to pitch. And if they’re the kind of investor you want in your company, this will be a pleasure, not a chore.


Start developing your relationship with investors before you need their money.  Tweet This Quote

About the author

Chris Yeh

Chris Yeh

Chris is the VP Marketing for PBworks, partner at Wasabi Ventures, and an avid startup investor and advisor. He is also a co-author of The Alliance and serial tech entrepreneur in Silicon Valley.

  • pinsolera

    Thank you for posting this article Mr. Yeh. I do agree with the posts, especially #1 and #2. When investers see you have uncertainty and lack certain confidence in your delivery, it makes them tentative, which could hinder them investing in your company. But keeping in touch with them is key, but I couldn’t be pushy because I would be much too afraid of losing someone that could possibly invest in a company I may have.

  • laurenkraft

    I agree Justin, by keeping them updated it will not only let them know about your business but when your businesses name keeps appearing that’s something won’t forget.

  • natebbeard

    Thanks for the insights, especially the update at the end. We’re at the point of making as many friends as possible. Hopefully when the time comes when we’ve proven traction and reliability, our friends will invest their time and money in something they find excitement in as well. Lastly, one thing I learned in business school is find a good lawyer, and your post highlighted the fact that we need to be constantly planning for the future. Thanks Chris!

  • Logan Dohmeier

    Being confident in what you are presenting is of utmost importance. Especially when you are trying to hook an investor on your “supposedly” good deal. I think you addressed one of the most important aspects of doing business, and that is consistently staying in touch. Just like when you interview for a job. You want to do the follow up and show them that you care more than some other lousy candidate. This also allows you to potentially add a few minor details that you may have missed. I think that when it comes to follow-ups, it is hard to go wrong.

  • lepkowskjj29

    I believe consistently staying in touch is the most important aspect of doing business.

  • turbo_frey

    Thank you for this great article Chris. Investing in a partnership takes commitment and commitment requires certainty. We can not move on in life without challenging our confidence by removing what we are most uncertain of. I also agree that the most important aspect of initiating business is to remain loyal by means of staying in touch and relaying messages. Once you lose touch, you may lose trust with the desired business as well as their interest. However, one needs to stay in touch only when necessary, and not contact them excessively because they may feel pushed and then wonder why. What do you think the most important aspect of conducting business with another firm is?

  • Thank you for sharing. Many don’t understand the importance of building relationship through trust and a sense of commitment. I agree with you along with Mr. Yeh that the most important aspect of initiating business is to remain loyal by means of staying in touch and relaying messages. Very well put. Thank you.

  • Brittney Glende

    I agree Logan that being confident in what you are presenting is most important. If you are not confident you loose all credibility in what you are presenting. By being confident you will be able to hook an investor on your deal. This was a great informative article. Thank you.

  • aulm92

    Thank you for this article Chris. I like the idea of starting to have a relationship with investors before needing their money. I feel like this can apply to a lot of different things, it seems to be a “who you know world” and having those connections makes all the difference.

  • Kevin Weber

    Thanks for the article! I agree that you need to establish a relationship in order for investors to see what you want. I like the second point in your article, where you say to keep in touch. Investors aren’t going to wait on you, you have to prove to them that your idea is working, and that you are interested in working with that investor. I can relate this point to when I’m applying to jobs. I will follow up my submitted application with a phone call or email within the next few days of completing my application, to see if they have received it and thanking them for considering me.

  • Connor Driscoll

    Thank you for sharing this article! I believe this is valuable for anyone looking to open a business who needs funding. For example, my aunt owns her own business and always stresses the importance of getting to know your investors before needing their assistance. Chris, would you say this is the most important component of working with investors?

  • jack lomax

    Im not going into business at all but this is sound advice! Especially the developing relationship part that you mention at the end. Whats more likely going to happen, borrowing money off a stranger or a friend? Exactly! The first solution, as what they are uncertain about? Fix that! Put their mind at ease! As soon as they are certain about a product, they have no reason not to want to invest in your product. If I was in business, I would have this information stuck on a wall somewhere. sound advice!

  • Evan Hibbs

    Chris, loved your article, thank you. I agree that you have to be aggressive about jobs and like you said, networking is huge. Even though you’re not working with a person at an immediate time doesn’t mean you won’t work with them later in life. Building relationships and maintaining relationships is huge. Who has been your biggest influence in your career?

  • mhansen11

    Thank you for this article! Being aggressive is very important in job searching or getting your word out on what you are promoting. Work is hard these days and for you to get a job, you can’t let them come to you, you have to go out to them and show them what you can do. Take the bull by the horns type deal. It will be difficult sure, but hopefully in the end it would pay off!
    Thank you again!

  • Brittany Arrington

    This article was actually very fun to read and the more I think about it, it is extremely relevant for those entrepreneurs who are looking for investors. Even though people may think they know everything, they are still frustrated and confused when no one will give their money. It is important for people to be open to constructive criticism to realize how to be the most effective when dealing with investors. Investors are busy people but they are there to help you so essentially laying everything out black and white for them and being persistent while not being too crazy will be a win-win situation for both parties.

  • Stephen

    Thank you for this article! Being aggressive is very important
    in job searching or getting people and money behind your idea. Getting people
    to invest in your product is not easy there is always a lot of uncertainty
    about an investment, being aggressive and minimizing sense of risk is very important.

    Thank you again!

  • Angela Hoch

    I also agree with you Evan about how aggressive you need to be about landing a job. It’s a very competitive market out there and it’s so crucial to network and get yourself out there. With networking there comes building relationships, like Chris mentioned, and that’s so important to maintain and continue. You never know when one of your connections may have a helpful resource for you!

  • Evan Hibbs

    Angela I agree with you. It isn’t always what you know but who you know! It’s important to try to build relationships with the right people so they can share knowledge with you with the hope to create a friendship that will last a lifetime. This is important in any field!

  • Tim Rutkowski

    Chris, I love these four steps. I think that it applies to more than just investing. I think that you could use it for job interviewing process. My question to you is what other ways would you think it could be used for?

  • Branden Unger

    Thanks for the article! Although I personally have no experience in investing, these are definitely good steps to keep in mind when investing. I agree that a more aggressive approach should be used when pursuing a potential job offer or trying to get people to invest into and back up your product. Thanks again for the great article!

  • amayeux

    It’s interesting to see the behind the scenes of investing. Shows like “Shark Tank” only graze the surface to capture the audience’s attention. The real-life application as to how entrepreneurs and investors talk to each other is interesting. Seeing someone actually give advice to entrepreneurs is an fascinating take on showing people how the field works.

  • Kelly Martin

    This article puts a new perspective on the selling process. I love how it explains step by step what to do when you reach the part of asking investors to join in your business venture. I know that many times you need a strong selling presence to get your point across effectively and in a quick manner. Thanks for writing this article, this is great advice!

  • Phillip Ellard

    I agree with kelly, Its funny I was just thinking the same thing. They took a different spin on it than I thought

  • ZecCepeidaConner

    investors are very busy individuals and an exceptional effort must be put forward in preparation for their time, during the pitch and following up after the pitch. This article relay’s that message. Investors don’t have time to fool around and ‘assume or guess’ they make money and they do it in the present, consistently.

  • Alex Dorn

    I agree most with point number 2. I have been told in multiple classes that being pushy in regards to the business world is extremely necessary, especially if you are looking for funding.

  • knapprl17

    This article was interesting to see what investors want out of the people who want to be invested in them. I feel like these can also apply in interviews for jobs as well. I felt the first one, removing the uncertainty, is important during interviews. An employer is going to be less likely to hire you if they are uncertain about your abilities and what you will bring to the company just as investors are worried about uncertainty.

  • JeremyWahl

    This article is very interesting. First thing that comes to mind is the TV show called Shark Tank. In the show entrepreneurs pitch an idea to investors and ask more a certain amount of money to help them succeed. I like your second principle on staying in touch without being pushy. even if you fail it is important to ask for feedback which can be helpful.

  • HelpHealth002

    Thanks for writing this article Chris. I think this is something all investment-seeking individuals should read. I found the points you made to be very interesting and useful for many. I think it’s also important for people to go to the type of investors that will have a personal connection to the product,etc, they are trying to get an investment for. Do some research on who your approaching and find ways you can make your claims touch their own lives. Make them believe in what you’ve been pursuing, and what you’ve believed in for years! What’s your number one piece of advice for those going to meet an investor?

  • Ryano313

    These four steps are very informative for entrepreneurs. Number two is the one that I think is very important. You do not want to be too pushy because that could potentially push you client or investor away from that investment. That is a daily life lesson as well, never be to pushy because not a lot of people like that.

  • Chris Williams

    Number two of the four steps sticks out to me the most. You need to be pushy in the business world at all times when it comes to obtaining funding.

  • Chris Williams

    This exactly came to mind for me while reading this article. Being pushy is immensely necessary in the business world.

  • The mechanics and the relationships between potential entrepreneurs can often be like a game of chess. Each, at times, could be manipulating the other. People do not want to invest, buy, or in any way obtain an item or an idea unless they believe it is the right one for them at the best possible price. You do not go into a store and buy an item, go to the cashier and offer to pay them more than the sticker price. You do not buy an item you will have no use for just because the seller tells you that you need it. People do not like a pushy car salesman who is trying to unload an auto that will not work in a few weeks. There has to be a mutual understanding between both parties. If you are an entrepreneur you must convince the investor that his or her money is being well spent and will live up to the potential you claim to offer. You must follow the right steps to succeed. This article offers many of the right steps. You must take them and utilize them in a format that will work for you. Thank you for sharing!

  • thomas kearney

    I always like the posts that you present they always interest me. I think all the different sessions that you broke down are key to grabbing an investors attention, sometimes it can be come very difficult to catch the attention of some investors. I think the stay in touch without being pushy is very key. A lot of times it can turn an investor off if they feel like you are constantly badgering them about a product. What do you think is the best way to stay engaged but not be pushy?

  • Camillewuensch

    I think that it would be in the best interest to get to know and develop relationships with investors. Not only then when you would need something they are more willing to help you out as a friend and possible become then your business partner.

  • Kelly Martin

    I thought about Shark Tank as well. It is ingenious! Thank you for making this point!

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  • adrianaferreyra04

    Great article! It is always important to have a great relationship with your investors, after all it is their money that you are spending. You absolutely have to create a strong bond because it will be needed in dire times!

  • Marcy Glad

    These same principles could likely be used with almost any business relationship that needs built and maintained. Understanding and attending to the needs and expectations of those in a professional network circle can nurture the desired results that are mutual beneficial for all. This article conveyed specific examples of how to do just that, which aren’t always readily available since relationship-building is so filled with subtleties.

  • Ashley Gardner

    I totally agree with you! It is not only good to have a great relationship with your investors for financial reasons, but just because who doesnt want another friend to have. The closer you are with your investor the more they will be willing to help you in hard times. And in saying that I am referring to financial hard times and being their to support you mentally to keep you going!

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  • kgonyo

    The idea of staying in touch without being pushy is so important. It may seem little, but even a small amount of communication will put you higher than someone else who spoke with them once and left it at that. Too many times we don’t maintain communication because we don’t want to seem pushy, but we have to find the line between too aggressive and forgotten.

  • Kaylie Mae Kuhnke

    the idea of staying in touch without being pushy was what stuck out to me the most as well. its a good idea to check in but if you are to forward and constantly bugging them they are going to back off and hire someone for sure.

  • McKenzie Foster

    I agree, this was a great article and it is important to have a strong relationship with your investors. They’re practically doing you a favor and helping you out. In any situation though, its always great to have a good relationship with anyone you’re working with because it’d be tough if you were always disagreeing with them.

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