How I got 50 high-profile angel investors to join our seed round
When I set out to raise the seed round for Mentava (an edtech startup to accelerate childhood learning) earlier this year, I knew it would be a challenge. I was a solo, non-technical, first-time founder, pre-product, pre-team, without an impressive resume or connections to the investors I wanted.
Nevertheless, our seed round accomplished everything we needed. Our round was way oversubscribed and we ended up raising $3m from over 50 of the best angels in the world, like Garry Tan, Tim Ferriss, Eric Ries, Balaji Srinivasan, plus founders of Figma, Flexport, Replit, Intercom, Thumbtack, Lambda School, Outschool, and a lot more.
As a lucky bonus, we also did it right before the crash, which means we got a very favorable valuation, which means that not only do we have a lot of runway, but we retained a lot of equity for our team.
My fundraising strategy was somewhat different than I’ve seen described elsewhere, and I think it’s a particularly useful framework for founders who don’t have a strong pre-existing personal network. Enough people have asked me about my approach that I figure it's time to write it down.
When the idea for Mentava was coming together, I found myself in a situation familiar to many first-time founders:
- I wanted to raise money
- I specifically wanted to raise money from top-tier angels because they also provide credibility, experience, personal networks, and often large audiences on social media
- I didn’t have close personal relationships with famous investors (or a large social media audience, or a reputation as a thought leader, or a degree from Harvard or Stanford, or a job at a FAANG)
The solution: Intro-driven fundraising
As a solo founder still in the process of building a team, boosting our company’s credibility via top-tier angels was my primary fundraising goal. One of the first things I did was to make a spreadsheet of 50 dream angels whom I really wanted on my cap table.
As I began looking for connections to those investors, I began to see that pitch quality doesn’t improve along a sliding scale. It’s much more about crossing a tipping point: Investors don’t want to waste their high-status friends’ time by passing along a weak or even merely good startup. But they very much want to do their friends a favor by getting them into a hot, oversubscribed deal.
For an intro-driven fundraise to work, you have to be so good that investors feel like they’re doing their friend a favor by introducing you.
Shortcuts make long delays
As I began reaching out to angels, I was optimistic about my chances. Our no-code pilot was going well (teaching 2-year-olds to read at a 2nd grade level) and I’d accepted a few checks from friends and family. If I could land an investment from a big-name investor it would dramatically accelerate the rest of the fundraise.
Despite a nagging feeling that it was still too soon, I reached out to a well-known investor on Twitter.
We had some friendly back-and-forth chats, but they politely declined without even a call.
I kicked myself for letting my impatience get the best of me. There was no excuse for not waiting until I had some decent momentum and a proper warm intro. On the bright side, regret over that mistake helped me avoid any other reckless shortcuts for the rest of the raise.
Imposter syndrome is real
After blowing that opportunity, I needed to know: How big was the gap between my current ability to tell Mentava’s story, vs the quality bar I needed to hit?
I recorded my pitch and shared it around for feedback. For me, this was the most uncomfortable part of the entire fundraise. Critical feedback from a personal friend bothers me way more than a rejection from a potential investor I’ve only talked to for a few minutes. I started to worry about my current investors: “What if seeing my lousy pitch shakes their confidence in me? What if they think ‘why did we just fund this incompetent guy’?”
Here’s what my actual investors had to say about my pitch when they saw it:
“Weird and jarring”
“Your face looks like you’re angry”
“A bit weird”
“Feels a little bit forced”
There was constructive feedback too, of course, but it was clear I had a long way to go. I postponed any intro calls with well-known investors and began pitching only less-established investors while I focused on improving my story.
Pitching is storytelling
The questions potential investors asked on those calls, plus the feedback I’d already received, helped me figure out where my storytelling was the weakest. The biggest gaps fell into three main categories: inability to explain our product, a weak narrative arc, and poor presentation skills.
Ok, but what is the product?
The most common question I got was “Ok, but what is it? What specifically are you building?” This turned out to be a frustratingly difficult question for me to answer well.
Sometimes superior products are the result of thousands of cumulative design decisions that compound on each other to create something transformational. (What’s the opposite of “death by a thousand cuts”?) Imagine trying to explain exactly why Marvel’s movies would transform the superhero genre, before any of them had been made.
I spent weeks trying to summarize Mentava in a single sentence that explained what made us different. I iterated through so many bad, clunky explanations like:
In the end, what finally worked was when simply I gave up trying to describe “what Mentava is” and instead described “what Mentava is doing”:
At Mentava, we:
- Train kids to teach themselves and become independent learners
- Provide software that lets them learn at their own, accelerated pace
When I used that explanation during calls, I could see things finally click into place for potential investors. And since they now understood the longer-term vision, I could get more specific about our near-term product roadmap without confusing them. “Our first product will be a learn-to-read app for 2- and 3-year-olds.”
Paint a better future
Another problem I had was over-focusing on the problems we were solving. I see Mentava’s emphasis on addressing root cause issues (e.g. lowered expectations, demand for equal outcomes, signaling and credentialism) as a major differentiator, but spending too long talking about them made me seem negative and pessimistic.
People want to be inspired by visions of a happy future, and I got much better responses once I spent less time dwelling on the shortcomings of modern education policy and more time exploring the possibilities of a post-Mentava world.
Presentation skills matter
One nice thing about fundraising over video calls is that I could practice my story on camera and see exactly how it would look to investors. I learned to always take investor calls at a standing desk, with good lighting and my camera at eye level. I kept my notes in a small window directly under my webcam to simulate eye contact as much as possible, and if I had a teleprompter available I absolutely would have used it. I’m still tempted to rig one up for our next round.
While watching my practice recordings, I also experienced how easy it is to zone out when watching me talk. I learned to vary my pitch, pace, and pauses to emphasize key points. I added cues in my speaking notes to remind myself to smile and be more expressive. Watching myself, I could see how much more engaging my stories became with more variance in vocal inflection and facial expression.
Test and iterate
As uncomfortable as the original feedback was, it was also the fastest path to improvement. And while I’m sure my first investors got a little worried when they had to tell me that my pitch was “weird and jarring”, I felt good about demonstrating my ability to course-correct.
The next time those same investors saw my pitch the reception was more positive:
“gosh this is 100x better niels. Thank you for iterating. Not only is the content tighter, you’re more specific about the product, and your passion and emotion shows thru”
In the end, I spent 4 months figuring out how to tell Mentava’s story effectively, and crafting that arc into a slide deck that could tell the story without me present. I knew my pitch would need to be perfect to stand out amongst the deal flow that top investors get, so I didn't go after them until I could consistently close every intro.
Once I was consistently closing every call, I finally started accepting intros to investors on my dream list and the rest of the fundraise moved really fast. From that point on, it took about 4 weeks of full-time fundraising to fill our round with 50+ investors.
The fundraise flywheel looked like this:
- Create spreadsheet of dream investors
- Ask friends if they know anyone who might know anyone on the list
- Request intros to the people most likely to say yes
- Send friend a forwardable intro email including a link to slide deck
- If investor accepts the intro, send them a Calendly link for a video call
- Close investor, send them a link to our RUV (via AngelList)
- Ask investor who they can intro to from the spreadsheet
Repeat steps 3-7 until round is full
Six Degrees of Kevin Bacon
Intro-driven fundraising is essentially a high-stakes game of Six Degrees of Kevin Bacon. How do you reach your desired investors in the minimal number of hops?
For example, one of the people at the top of my list was Tim Ferriss. Mentava’s mission is to teach kids to teach themselves, so Tim’s passion for self-education was a perfect fit. And his massive audience would be a tremendous asset when the time came for us to get our story out.
It took three hops to find an introduction to Tim: first an angel that I cold-messaged on Twitter, who introduced me to a second angel, who introduced me to Tim.
One particularly busy investor required 7 independent warm intros from different people before I was able to make contact!
Ask for the money
One painful mistake that I made in my early calls was not closing solidly enough. My discomfort in pushing for specifics while on the call turned into weeks of email tag, trying to get a commitment on a specific dollar amount, and then managing the back-and-forth of the actual fund transfer.
After a few failures, I learned to push through the discomfort and ask for a specific dollar amount while still on the call. And then further followed up that dollar amount with “Perfect! I’ll send you an RUV link to handle the investment. And I’m trying to finalize allocations ASAP, how soon do you think you could take care of it?”
Even after all the commitments had been made, I wasn’t prepared for the amount of cat-herding required to wrangle the actual money transfers. I had to navigate family offices, personal assistants, busy schedules, legal reviews, mis-sent wires, unanswered emails, and so on.
Every couple days I’d send out a new message, reiterating how hot our round was and trying to instill a sense of urgency:
“Quick update: [big name investor(s)] just invested! The round is filling up and I’d really like to get you in. Let me know if you’re having any problems with the link!”
It was a huge relief when the final check came in.
Send the slide deck first
In the end, I closed 80%-90% of the angels I talked to. One reason my close rate was so high was that I always sent a thorough slide deck before the call. It covered all the standard investor talking points: mission, team, pricing, customer acquisition, traction, moat, etc. Since I’d spent so long iterating on it, I knew my deck told Mentava’s story as effectively as I did in person.
Because the slide deck already told our whole story, the actual calls were frequently just a formality. In fact, several angels sent money without ever talking to me. If an angel wasn’t interested, they would just decline the original email intro, which saved us both from wasting our time.
Angels vs funds
I should also say that I talked to a number of funds during this process, and my success with angels was exactly mirrored by a string of strikeouts with VCs. I’m reluctant to draw too many conclusions from my sample size of one fundraise, but in general the vibe I got was that angels were looking for reasons to say “yes”, and VCs were looking for reasons to say “no”.
Alongside many other concerns, lots of funds were apprehensive about investing pre-team or pre-product, some thought what we were doing was impossible, and some were simply a values mismatch. The exceptions were Quiet and Floodgate, who both understood our vision instantly and were thrilled to support us at such an absurdly early stage. You rock!
When people ask me what fundraising was like, I can genuinely say that I found it pretty fun. Every rejection surfaced a new flaw in how I was telling Mentava’s story, and it was satisfying to chip away at those weaknesses little by little. There were a few stumpers that I really struggled with (like the aforementioned “yes but what is it” question) and it was particularly gratifying each time I finally figured one out.
What I found was that the fundraising journey wasn’t about the growth of the company’s bank account. The journey was about the growth of new skills: from being a lousy storyteller to telling Mentava’s story in a way that inspires people.
And that’s important because all the investor calls I took were just the practice round for what really matters: hiring. Getting so many mistakes out of the way in front of investors left a lot fewer mistakes for me to make in front of candidates.
So if you’re passionate about education, I’d be happy to personally tell you about Mentava’s vision for the future: where parents can send their kids to whatever school they want, be part of their local school community, have them surrounded by a group of peers their own age, and still know that their kids can access a world-class STEM education. We’re hiring!