COVID-19: 7 ways networks can engage investors & improve fundraising success rates
Angel networks help ventures grow and connect with investors.
However, securing funding for companies has become increasingly difficult during COVID-19.
One survey showed that only 65% of UK angels investors are still active during lockdown.
Those that are still looking to invest have seen their total capital to invest reduced by over 60% in 2020.
It’s up to networks to keep investors interested before and after the initial engagement with companies.
Thankfully, moving your investor relations online is easy.
Here are some tips to get the best out of digital during lockdown (including two tips provided by angel networks during the UKBAA’s August Roundtable on ‘Exploring the new normal’):
1. Bring your pitch event into the age of digital
Before COVID, you could rent a room in a restaurant, bring in food and drinks, invite investors and startups and just let the magic happen. Nowadays, you have to put on engaging online pitch events. Organizing one pitch event is not enough. You have to make sure that investors will come back for the next one. Here’s how:
- Have a manageable number of companies participating
Organize run-throughs with your companies and make sure that you don’t have too many pitching at once. You can divide events by sector focus or company development stage, if you think investors will be overwhelmed.
“Quite frankly, after listening to two or three pitches, the investor’s brain gets fried, and all the pitches start blurring into one another.” (seasoned angel investor, Dr. Aniruddha Malpani)
- Go over pitches before the event
Make sure that companies are putting their best foot forward by reviewing pitches before the event. Make sure that companies know what investors are looking for and how much time they’ll have to present their opportunity.
- Build polls and custom surveys
Keep investors engaged through in-webinar interaction. Ask for feedback on companies and prompt investors to ask questions during and after every pitch.
2. Keep investors engaged with educational and social online events
Talking to your investors two to four times a year won’t be enough to keep them engaged. Organize expert workshops and inspiring talks and ask them to attend. You can prompt them to participate and speak at your events, to encourage communication with startups. Your events can be informal and unstructured, allowing investors to have a chat and update each other on their sector, or tackle educational topics:
- First-time investor tips
- Legal and accounting issues
- Hot investment areas
- Developments in policy, schemes, and programs designed to help angel investors
3. Pair up inexperienced and seasoned investors
Taking part in the UKBAA’s August Roundtable on ‘Exploring the new normal’ has been very eye-opening. One tip we garnered from their event was shadowing: pairing up investors to give first-time investors the confidence they need to take the plunge.
- Identify seasoned investors who are willing to provide mentorship and explain that they would be shadowed for a while until a first-time investor is confident enough to go out on their own
- Reach out to first-time investors in their sector and find suitable candidates
- Set up online meetings so the two can discuss opportunities and next steps
4. Turn lead investors into ambassadors
Our second UKBAA Roundtable tip is encouraging one investor to take the lead and promote an opportunity. Sometimes investors need a little push and seeing interest in a deal will put their mind at ease.
- Encourage them to start a conversation on social media, and let their audience know about the opportunity
- Make it easy to share Information by providing brand images and content for their posts
- Answer their queries quickly and keep in constant contact to receive feedback
5. Use social media to nurture relationships
Social media allows you to develop and nurture relationships with investors, keep them updated on the events and companies they’re interested in, and solve queries on the spot. When done right, social media is a very persuasive and impactful investor engagement tool.
- Set up a social media schedule for consistency
- Prepare and plan out your content in advance, and use software to allow scheduled, automated posts
- Use shares, likes, follows and retweets to engage with your audience
6. Send email updates
Prompt startups to provide updates and keep investors in the know. Constant engagement will generate trust and help build a better rapport with founding teams. Updates could tackle:
- Product or team development
- Funding progress
- Partnerships and interest from customers
7. Envestry for networks
Our network product’s built in features take the hard work out of updating investors on companies’ progress. We know that peeking investors’ interest in your companies is a difficult job, so we’ve built a tool that does the job for you.
Envestry is a friendly, easy-to-use branded marketplace that allows you to post deals and share them with investors. They will be able to ‘follow’ companies or pledge investment and will be alerted when there are:
- New developments in the team
- New investor pledges
- Updates on partnerships and customers
- Q&A – Investors may ask companies questions and receive responses on the platform
We’ve also built a syndication feature that allows networks to share their deals with other network partners, if struggling to fundraise for their companies.