With hundreds of thousands of investor profiles from all over the world, there are many entrepreneurial success stories of people and companies that raised their startup or seed money from LinkedIn as an investor resource.
However, the challenge is how to go about it in the first place.
This article will explain why you should use LinkedIn in finding potential investors and how you can find one.
Why Use LinkedIn In Finding Potential Startup Investors
LinkedIn is a social media platform that can help you grow your startup business, opening up new marketing opportunities and building a solid network of professional followers.
LinkedIn offers access to a large pool of skilled and qualified individuals, as well as the opportunity to identify potential investors for your startup finance needs.
A study from Greenwich Associates reveals that from 256 256 corporate and public pension funds, insurance companies, endowments, and foundations in Europe, the United States and Asia, nearly 80% of institutional investors utilise social media as part of their daily routine. Roughly 30% of these investors claim information received through social media has directly influenced an investment recommendation or decision.
LinkedIn is also the most used social media platform for Institutional Investors, with more than 50% of all institutional investors using the network for professional or financial purposes.
LinkedIn, when used correctly, is a powerful marketing tool that can help you find potential investors and make your startup business grow.
Here are nine helpful tips to help you find investors on LinkedIn:
Tip #1: Study at your LinkedIn profile first
If you don't already have one, create a LinkedIn Company Page.
The following should be included on your page:
- Your cover image and logo
- Your company description
- The products and services you're offering
After creating your page, familiarise and educate yourself with LinkedIn's features.
Understand and study your profile, as your LinkedIn profile will serve as your online resume.
It contains essential information about you and your background that investors will use to decide whether or not they want to connect with you.
Tip #2: Establish a solid and great profile
Your LinkedIn public profile, which serves as a pitch deck or resumes, is open to all users to view.
Investors will undoubtedly look at your profile, so make sure it makes a great first impression on your potential investors.
Here are some points that are essential to get some interest from an investor.
People's first impression of your page will be based on your headshot.
Adding a decent headshot is one way to establish a solid and great LinkedIn profile.
Avoid using a cartoon or a landscape, and posing with your pet is not recommended. However, be creative if that fits with what you do or who you are.
Highlight your experience
An investor will not be impressed if you copy and paste your CV onto your LinkedIn profile.
Instead, include any jobs or companies that you believe are relevant to your desired destination.
For each job you include, use two to four intriguing and stunning bullet points. Utilise the appropriate action words to demonstrate what you did and what you accomplished in each position.
When you look at your current profile, you'll notice a gauge on the right-hand side that measures your "Profile Strength." This tells you how thorough you've been in filling up your profile.
Continue to add more and use LinkedIn tips until that gauge says you're an "All-Star." It's basic, but it can help you figure out whether you've missed anything.
Ask for recommendations
To make your LinkedIn profile lookout, you'll need recommendations. Investors want to know that others have approved your work. Consider folks with whom you've had a positive working relationship in the past.
When you change your profile, there is a link labelled "Ask for Recommendations" that you can click. Select it by clicking on it. You can choose what you want to be suggested for, as well as a list of people from your network. After that, send it out and hope for a positive response.
Tip #3: Conduct a Linkedin Search
One of the most powerful features of the LinkedIn network is its search capability to search for potential investors.
Here are several tips on using LinkedIn Search:
Same filters, new location.
LinkedIn has now placed the search filters at the top of the search results page to make it easier to find what you're looking for.
The most commonly used filters - such as location, connection degree, and current companies - are displayed by default to make it easier to focus your search.
The All filters page also allows you to see all of the search filters available, allowing you to filter results by industry, institutions, past companies and more.
More relevant results.
LinkedIn also changed the search results page to help you find what you're looking for faster by anticipating what you're looking for and displaying those results first.
Search connections of your connections.
Check out the connections of the filter to make it easier to connect to your extended network.
This filter can be accessed by clicking on All Filter at the top of the search page or straight from the profile page of a connection. You may then refine your search even further, for example, by looking for your connections' connections who work in a specific field or at a particular company.
Tip #4: Become Part of LinkedIn groups
Like many other social media platforms, LinkedIn enables you to join a group of people who have similar interests, likes, and expertise.
Joining groups might assist you in locating potential investors in a particular industry. The goal is to diversify your selections by entering more groups with various backgrounds and interests.
Tip #5: Use the Power of Keywords
Finding possible investors for your startup requires the use of keywords.
As a startup founder, you'll need to develop a list of creative and easy keywords relevant to your project to help you obtain investors.
Consider keywords that are relevant to any new initiatives in which investors may be interested. Appropriate keywords guide investors to your profile and help them reply quickly to produce a prospective lead.
If you're unsure about the exact keywords, look at what others in the field are using. Filter them according to which ones would be most applicable to you for comparable tasks. Read until you discover the terms you want to use.
Tip #6: Create a Story
In fundraising, storytelling is everything.
You can acquire startup investment using LinkedIn in one of two ways: you can undertake an active search yourself, or you can let the investor find you.
In any case, as an entrepreneur, you must have a tale to share once you two connect.
The potential investor should be able to relate to your project story. It should be one-of-a-kind and able to pique the listener's interest.
Personalise your message, make it clear, and make it understandable. Use the background knowledge and research you've gathered to position yourself and your project as a lucrative investment option. Avoid generating uncertainty and utilising technical jargon.
If an investor doesn't comprehend what you're saying, they will likely look for another option.
Tip #7: Reach out to connect first, but don't pitch directly.
When it comes to finding potential investors, reach out to connect first; don't pitch directly. Resist the urge to ping investors who sound like a good fit right away.
Instead, ask mutual contacts for insights about them.
If you could get an introduction through a mutual contact, your "accept invitation rate" can increase.
However, if you don't have a mutual connection with a possible investor, follow their company page. Join any LinkedIn groups that your target is a member of. Read their blog, look through their profile, and read their posts to get a sense of the person's portfolio, investment strategy, and likes and dislikes.
Then, write a personalised invitation through email. Here are some things you can mention:
- If you've met before, remind them about that.
- Describe why you'd like to connect.
- Describe how connecting can lead to a mutually beneficial relationship.
- Mention something you have in common, such as going to the same institution, sharing a pastime, etc.
Keep the connection invitation brief and to the point.
If they connect, congratulate them for doing so, and send them an investment teaser.
Tip #8: Send a Teaser Offer
An investment teaser, also known as a one-pager for startups, is a brief document that provides an overview of the investment opportunity you're pitching.
Consider it as your company's resume.
Investment teasers are essential because it's an introduction to your startup. It's the paper that a potential investor reads to see if they're interested in not only your company but also the investment possibility in general.
Also, the tone of your investment discussions will be set by these one or two pages.
After reading your teaser offer, the investors will be aware of most of the necessary details about your company. There's a significant probability that the following talks will be influenced by the information you place on this document.
The following are typical elements of an excellent investment teaser:
Company Overview or Executive Summary
This part includes a summary of what your startup does, the key players, and what makes it different from your competitors.
At the very least, you should include high-level information about any solutions you've developed, the products you sell, the market, other competing companies, and, finally, what you're hoping to achieve.
Rather than the company, solution, or competitive advantage, investors often choose their investments based on the team.
This idea is that a great team can fix practically any problem, whereas a bad team can ruin even the best-run business.
Naturally, investors are interested in your business as a means of profit. They'll want to know how strong your financial position is.
Typically, 2-3 years of historical revenue and EBITDA are recommended.
However, if your startup is newer, you may not have that. If this is the case, include everything you can. You can also include your revenue predictions for the next couple of years and how to make those predictions a reality.
You can get into specifics in this parThey're as market capitalisation or a justification for the funding you want. The goal here isn't to offer all the details; instead, it's to let investors know if they're in the exact estimation as you.
Tip #9: Keep Updating and Remain Active
Lastly, keep updating your LinkedIn profile and remain active.
Being active on LinkedIn is an obvious and crucial component of using the platform to attract investors for your startup.
Your activity aids people in finding you, learning more about what you have to offer, what you do, and what you believe in, as there's always plenty of potential in using LinkedIn for growing your startup business.
LinkedIn is a professional social media platform where you can find potential investors for your startup.
You can use the following ways above to find potential investors for your startup.
However, always remember to be patient and respectful to the people with whom you're trying to connect.
If you want to know more tips on using LinkedIn to find potential investors or any queries regarding your startup, you can schedule an appointment with us.
Rest assured that someone from our team will get in touch with you to answer all your questions.