How would you approach building relationships with potential investors at networking events?

I wish the founders had taken the time to prepare for investors who are present, instead, founders use a lot of word salad within the first 30 seconds. Investors at networking events need to like you. Founders tend to approach VCs like kids at a lemonade stand, hoping for a dollar but dreaming of a million. Then the VC thinks, "A million? Sure! Just let me check if I left that in my other yacht." It's the unrealistic expectations from a founder causing VCs to become wallflowers in social events. I find founders who are willing to strike up a genuine conversation have better success in moving forward. Having a nonchalant pitch is essential to have VCs ask more...

There is a delicate balance here. Going into a networking event with a script and a 'hit list' might feel too rigid and not allow for natural connections to be made, but having no guidance or goals often leads to lackluster results. Doing enough research on the people you are keen to meet, so you can have the prepared mind, and also show that you've done your homework helps you stand out. Relating something they've done to what you do is helpful -- 'I know you invested in this company, we've learned a lot from them and employ XYZ approach'.

Some simple but effective time-tested ways are : Be approachable: Smile and maintain good eye contact. ?? Listen actively: Show genuine interest in others.?? Ask insightful questions: Demonstrate knowledge and curiosity. ?? Exchange business cards: Follow up promptly. ?? Build rapport: Find common ground and connect on a personal level. ?? Follow up: Send a personalized email within 24 hours. ?? Leverage social media: Connect with investors on platforms like LinkedIn. ?? Attend industry events: Expand your network and stay updated. ?? Seek introductions: Leverage your existing network. ?? Offer value: Share insights, knowledge, or resources. ??

In order to listen to something that is relevant, make sure you prepare questions. Don't talk about yourself. Just ask questions. Most founders make the mistake by just starting to talk about themselves instead of asking questions. First, figure out what the investment thesis is of the investor in front of you. And if you are not a fit, don't walk away. Perhaps you know a startup that fits their criteria. If you add value, they might add value as well, by connecting to another investor that could be a match.

A lesser-known aspect of organizing information before investing is the use of network analysis. This approach examines the connections and relationships between entities like founders, investors, and companies to identify success patterns. By mapping these relationships, you can uncover hidden patterns, such as frequent strategic partnerships between successful startups and specific investors or collaborators. This analysis offers deeper insights into the investment ecosystem and can reveal opportunities not apparent through traditional financial metrics or data.

The biggest mistake I've seen founders make at networking events is when they approach a VC and immediately pitch their startup. This shows that the founder is desperate and that they only care about money. Instead, founders should view VCs as someone they can provide value to as opposed to a source of capital. Oftentimes, your startup may not even be a fit for the VC (due to industry, geography, check size, stage, or other factors), and/or the VC may not be actively deploying capital. If you do your research beforehand and find out what the VC is interested in, you can talk to them about relevant industry trends, invite them to an event, or even introduce them to other founders. This will cultivate a long-term relationship.

Building relationships with potential investors at networking events requires a strategic and value-driven approach. Start by researching the investors attending the event to understand their interests and investment portfolios. During conversations, focus on listening actively and asking insightful questions to demonstrate genuine interest in their work. Share relevant insights or industry trends that align with their interests, showcasing your expertise and the value you can bring. Offer to connect them with valuable contacts or resources within your network, positioning yourself as a helpful and knowledgeable partner.

Ask questions about their journey into VC, show interest in them personally, ie. Where are you from? What is the most interesting deal you’ve come across? What company succeeded that surprised you, what company failed that surprised you? VC’s invest in people as much as products. They want to work with people that are enjoyable to spend time with. The pitch will come later, focus on connection.