Investor Relationships with Sam Wong
Blackbird Partner, Sam Wong provides insight into building investor relationships and how to tell if investors have fallen in love with your business (or not).
In our latest Giants Weekly session, we were joined by our very own Sam Wong, partner at Blackbird Ventures. Sam shares her firsthand insight into what investors look for in founders, how to tell if there is love at first sight (or not) and how to build meaningful relationships with investors.
Are they into me?
There are surprising parallels to teenage dating and start-up investing, says Sam Wong. Contrary to popular belief, “investing is less about rational decision making than you think and more about falling in love.” It’s for this reason, there are some telltale signs that an investor has fallen in love with your business after the pitch;
- The meeting goes over time
- The investor is already talking about introductions for new hires or customers
- They have invited you to a partner meeting
- The investor is talking more than you
If the love is there, Sam says you should treat raising like an auction. Set the auction date, have regular inspections before on a cadence and then use competitive tension to get the best deal.
What is a no?
As a start-up founder herself, Sam knows what it’s like to be on the receiving end of a ‘no’. What’s worse is a drawn out ‘maybe’ (or what she calls a not yes). Here’s Sam’s advice on determining when an investor is not that into you;
- They make no introductions for you
- They say it’s too early (even when they have invested in a seed round before)
- They don’t log in to your product and play around (for SaaS companies)
- They don’t ask people about you
- They push out the timeframes to get you a term sheet
It’s important to pick up on these signs so you can use your resources to focus on warmer leads. “A slow yes is a slow road to hell,”says Sam. Blackbird sets KPIs around how long it takes to send out a term sheet and onboard a new portfolio company. Sam likes this metric because there should be a ‘hell yes’ after the pitch, a drawn out yes is not usually a good indication the investor believes in the business.
Building relationships with investors
In her Giants Weekly session, Sam shared some collated observations on what she’s seen founders do successfully to build relationships with potential investors.
Make an email list of potential investors. Then send regular email updates on your company’s progress, key metrics or milestones. If you want a response, be really specific e.g. we want X customer, do you have any leads. You’ll get the added benefit of knowing which investors are warm/cold based on who replies and asks questions.
Surface the believers
“The internet is your oyster, you can stalk your investors on LinkedIn, Medium and a million other platforms,” says Sam. Interact with forums, groups, with Twitter accounts, or podcasts, where you’ve seen your target investors appear.
Building out nodes in your network
Find investors, or even experts, in your industry and ask them for advice, says Sam. People generally want to help and this has the auxiliary benefit of putting your business on the map. Non-technical investors can then use these as points of contact to ask others what you are doing before they consider investment.
The best way to build relationships with investors is to meet them! Applications are now open for Startmate's next round of Office Hours. Book your place for one-on-one mentoring sessions with startup investors, advisors and founders today.
Read more from Sam on her medium.