In part three of this Perfect Pitch video series, Stéphane Nassar from OpenVC explains how to build a cold email that makes investors take notice, the right way to share a pitch deck, and the best channels to reach VCs.
Key takeaways:
- As a last resort, cold emailing can work when done right with customization, deeply vetted investor targets, and the right channels
- Share pitch decks using a dedicated viewer tool for a more professional approach
- A free tool like OpenVC lets you connect with investors who’ve opted in to outreaches via email or channel
The transcript is below, and the interview can be watched on Youtube.
Okay, now you have your list, you’re ready to shoot your shots, you’re ready to start cold emailing. So, let’s look at the materials, meaning the email subject, the email body, and the pitch deck. This is what constitutes your fundraising material at this point.
The first thing you should have in mind is that this is not a numbers game. Sometimes, especially if you have sales experience, you’re going to feel, “Okay, I know the playbook. I’m going to set up email automation, I’m going to have a template, I’m going to shoot the same email to all my potential leads.” But that’s not the same process at all. You don’t want to do that. And the reason is when raising funds, you have maybe 50 to 500 investors in your list. That’s not a lot and you only get one chance to make a good impression. So you don’t want to do the “Hi {First Name}” thing.
Instead, here’s what you want to do. That’s my process. Not saying it’s the best, I can probably improve it, but that’s my proposition for you. Start from the firms you want the least. And then go upward. Research within the firm who’s the best recipient. Especially in big firms, they may have one guy who is the FinTech guy, a girl is the biotech girl. So, you want to find who is the best recipient for you within that firm.
Then, you’re going to research that person. You want to research their portfolio, which is the investment they made or they worked on, and you want to research their social media presence. What do they speak about? What do they care about? What do they say? And you want to find connection points with your own project.
And then you’re going to craft a custom email and in that email—and we’re going to see in a minute what it looks like, actually, I’m going to show you a template—you’re going to tell them exactly why you think they are a good fit for you and you’re kind of going to do the homework for them, which is “Okay, this is why we are a great fit and we should speak.”
And then once this is all done, I recommend you usually send four emails per day. It’s like if you spend 15 minutes per email, that’s an hour per day, Monday to Friday, and then you iterate.
So, I say this is not a numbers game, it’s not a sales process. However, it is a funnel process. So, you have those three steps. Once you email the investor, the first thing he is going to see is your email subject and 50% of chance he’s not even going to open your email. That’s why you need a great email subject. And we’re going to see in a minute, great examples of email subjects.
Then let’s say he opens your email. Congratulations, first step done! Email body: You want to create an email body. Again, going to show examples, but that’s not enough because then you want him to open your pitch deck. And we’re going to see how to do a great pitch deck. But these are all steps that you have to go through and at the end to get a reply. So that’s the funnel.
Email subjects. The email subject is a critical part of your fundraising process and most founders don’t spend enough time on it. You want to have two things and only two things in your email subject. One is the signal. Remember the signal: we discussed that before. And two: fit. You want to show that’s the targeting phase that we should be for.
So you show the investor that this is a deal that is in my space that I should know about tnd two, this is an exciting deal. And you want to convey that within 50 characters because 50 characters is how much space you get on a mobile phone. So when the investor receives your cold email, he’s in the metro or he’s in the car, whatever, he sees the notifications. 50 characters is all you get to get them interested and excited.
So, here in green, you have three examples. You see, we have here, here, and there, the positive signal. It’s always nice to include numbers. Numbers capture attention, it’s been proven. And then depending on the space, enterprise size, B2C delivery, you try to, of course, customize it based on the recipient. That’s the good ones.
And then at the bottom in red you have the bad ones. Please don’t do that. I keep repeating that. I keep seeing it and know it’s just because this is what we do, we kind of screen-deal flow based on cold emails and it’s sometimes painful to see people repeat the same mistakes again and again.
So for your own good, for your own sake, don’t do “My Startup Name – Pitch Deck.” Don’t try “seeking investments” in your subject. Your email subject is prime real estate. It’s super valuable. So, don’t use low-value information there. You have to write high-value information that is impactful and convincing.
Okay, enough for the subject. Now the email body. Here is a template. I mean it’s an example, but it’s a template. Not going to read it now with you, it’s a bit long, but I’m going to break it down with you actually. Okay, let’s hide my ugly face to the left.
Okay, so my preference, you can find all the templates online, there is no definitive data on that, but this is what I like to do. Start with personal greetings. “Hi John.” Include the first name of the person. If you don’t have the name, I mean it’s always better to email someone. If you don’t have the name, it’s “Hi Sequoia team” if it’s a general email address. But if you’re emailing a generic email address, you’re probably dead already.
Then start by introducing yourself. You’re talking—you are a human being talking to a human being. So, you have a first name, you have a last name. Say who you are. I’m Chad Kroeger, founder of Nickelback or whatever your startup name is. You have to be the CEO or, at least, the founder. An investor doesn’t want to talk to an assistant, they don’t want to talk to a fundraising advisor or consultant. Even if they are the one writing the email, it has to look like it comes from the founder or the CEO.
Okay, then a DevOps platform that automates the QA process for large financial institutions, whatever that means. The important thing here is it’s short, it’s to the point. Don’t use complex words. See here, I’m not saying I enable digital transformation for industry 4.0 of whatever. Like, complex words are signs of amateurs—don’t use that.
Use simple words, keep it simple, and then move straight to the next part, which is to show the investor why you choose them. So, we discussed that earlier—that’s actually the bulk of the work you’re going to do because all the rest is standardized, but this part in purple or in pink is where you’re going to spend the most time.
So, here, what did I do? I mentioned two investments they’ve done that are similar to me. So, I show them, okay, I know your portfolio companies, so I’ve done my homework and I know if you like them, you’re going to like us. And then I mentioned a Twitter thread. So that’s always good for the investor ego—basically that you follow them. That’s what I call the belly dance, right? You have to do a belly dance to capture their attention. It’s sad, but it’s a fact that everybody loves attention.
So, here’s sure that you write the thread and you find the thread that actually matches what you’re building. And so that’s the best way you can hook it up. Okay. Once you’ve done that, you move to the quick facts.
Here, I love bullet points. Why? Because investors are not going to read your email, they’re not going to read the sentences. They’re going to speed-read through it and capture words and numbers. And bullet points make it sure that they see that. And each bullet point is a positive signal. So, I usually like to go with three bullet points: one for the team, one for the product, and one related to growth.
So, growth can be sales, marketing, users, anything like that. So, in that case here, you can see I drop numbers, I drop names of companies and it’s short, it’s to the point. But it’s exciting enough. I don’t need to tell any more. I don’t need to explain all the details, technical details. I don’t explain the features—I don’t describe the product—I just say enough to get the meeting.
And then, of course, the last part in blue, is the call to action. My advice: always include the deck. Don’t be that person who sends an email, it’s interesting, and then the investor replies, “Okay, seems interesting, please send the deck.” You’re wasting your time, you’re wasting the investor’s time—it sucks. Just share the deck.
And then I also like sharing the Calendly for ease of booking on the investor side. Of course, old-fashioned investors might be offended by the calendar link but honestly with an email like that, it’s their loss if they pass because of that.
And very important, you see here we have a clear call to action. It’s something that people don’t do enough. They’re not clear about what they want. Here, I say, “Would you be open to a 30-minute call next week?” It’s kind of a yes or no question, linking to Calendly for the call to action.
And then at the end of the day, look, I think this email is pretty solid. It has, as an investor, the information I would want to decide if I take the call. And it’s 630 characters so that’s super easy to read, right? It’s going to fit on the screen on my mobile phone. I’d only scroll. I’m not going to feel like I waste my time and yet it has everything. So, try to stick under 1,200, 1,400 characters. As a general rule, you probably don’t have enough interesting stuff to say that occupies 2,000 characters. And actually the longer the email is, the less likely it is going to be read.
So great subject, great body. Now, clicking the pitch deck. What is a good deck? What’s a bad deck? Let’s see that together. Bad deck on the left, good deck on the right. The bad deck…I’m sure you can already see where I’m going with this. The bad deck: lots of text, small font, unpleasant to read. On the other side: a big deck, little text, big fonts—that’s the spirit.
Titles. The bad deck is usually going to have an abstract title like market, team, competition. This is how we used to do decks like 15 years ago. Today, we consider it much better if your deck actually highlights the message or the message of the slide.
So, here in the example we’re after an $80 billion market opportunity. Why do I do that? Because if the investor doesn’t reread my deck, he just goes through it very quickly. He will still see that, he will still get the message. He doesn’t need to actually read and understand the graph or the text or the content.
So, you offer two levels of understanding. There is the title level and then the detail level. And most investors will quickly just read the titles. Then, if it seems worthy of their time, they’ll go back to the start and they’ll start reading each slide again. That’s the reality of browsing pitch decks when you receive 10 per day.
For the same reason, keep it short. 12 slides is enough. You’re not here to tell everything about the company. You’re just here to tell enough that they get excited and give you the call you want.
What you want to do, however, is have your 12 slides professionally designed. If you can afford an experienced tech designer, go for it. It’s going to be worth the money. If you cannot afford it, which is often the case at the pre-seed stage, at least get yourself a good template online. You can find great ones for like $50.
And then after you’ve customized yourself, just pay someone on Fiverr to improve it, do the fine-tuning, and then you have something decent. It may feel unfair that why do I have to care about design? I’m an entrepreneur, I’m a business person. And I agree with you: it shouldn’t be the case, but it’s just how it is. You’re going to compete with nine other decks, received the same day, and you want to give a professional feel. You want to capture attention. So, consider it a marketing cost.
Password protection—don’t NDA, don’t sign up. You want instant access. Just FYI, your deck will be downloaded even if you deactivate deck download because there are plugins to do that. So, every investor can actually download your pitch deck. Your pitch deck will be shared whether you like it or not. So, if there is anything confidential, just don’t include it and make your peace with it. Just consider from the moment you share a pitch desk with investors, consider that the content is on page one of Google. So, if you have this in mind, then you know what to expect.
And the last point, of course, is to use a pitch-deck viewer, something like Docsend. I mean Docsend is the reference today, so probably go with them. PDF attachments are a thing of the past and you want to be able to track open rates, track how much time you spend on each slide. So, a deck viewer feels more professional. Investors will try to read every little detail and get to conclusions with shortcuts. So, someone who doesn’t share a deck professionally already ranks a bit lower than someone who shares their deck professionally with a dedicated tool.
Last point is the channel. So, this one is just one slide and we’re done. The channel. So, you have everything ready, it’s time to reach out. How are you going to reach out? I think there are four main channels that you can use. Twitter is great—it’s amazing, especially with U.S. investors. Your parents? Not so much. It’s great if they’re active there and if you’re active there because you can build up the relationship in the months leading up to the conversation. The downside is that in most cases you cannot message someone directly. The DMs are closed by default. And so you have to submit a request for DM and the person may accept or reject. But because there is this screening phase, it’s what I would call mid-trust.
Then you have LinkedIn. So, everybody’s on LinkedIn. That’s great, you may have to pay for emails to be able to reach out to everybody. But the fact that there is no screening, and that everybody’s there, makes it a very noisy platform. So, what I mean by that is everybody’s on LinkedIn, everybody’s spamming investors on LinkedIn. And so when an investor receives something on LinkedIn, usually it has a low level of trust. They think, “Okay, it comes from LinkedIn, it must be shitty, by default.” Excuse my French: “not great.”
Third one: email. Everybody has one so that’s convenient. But you have to find the email address or use an email finder, which can be an extra cost, extra complexity. There is no screening. So, again, this gets overwhelmed in their mailbox, which means that it’s usually low trust.
And the last one is OpenVC. So, obviously here, it’s my little baby but you have 5,000 investors—people who opted in to be contacted. So, they are usually more open than average. We provide you with the email or we provide you with the right channel to contact them in. So, that’s chosen by the investors themselves. Again, they opt in for that, and we do screen the deal flow. So, if we reject you, we explain to you why your email was not sent.
But if it is sent, it acts as a positive signal because if we agree to send it to the VC, then they know it has been vetted to some extent and they tend to trust it a little more. That’s why I rank it as mid-trust. And it’s completely free for the founders and for the investors. We don’t charge a subscription fee, we don’t charge a commission or anything of that sort. So, we are on an open-source model for now.
So, that’s it! I hope it was helpful. Again, keep in mind that you are expected to start this thing on your own, with your own money, with your own network and cold email outreach is only supposed to be the last resort type of thing. But if you do it and do it right, it has worked. I’ve seen many, many instances where it worked. But it’s a lot of work to customize it, reach out to the right people you’ve deeply vetted and qualified, and use the right channels.
Good luck with your fundraising and hope to see you soon. Bye-bye.
