Entrepreneur Office Hours - Issue #7
Talking about piracy with the founder of The Pirate Bay, learning about entrepreneurship from my 5-year-old, and cold-emailing investors
On this week’s episode of Web Masters, I had an incredible conversation with Peter Sunde, founder of The Pirate Bay. Peter literally went to jail because he believed so strongly in the mission of his startup. How crazy is that? Rarely do I say you have to look at my content, but you really do have to check out this episode. It’s my favorite episode yet.
Also, at the end of this newsletter, I answer a question about how to send investor emails that actually get responses. If you’re fundraising, be sure to check it out.
As always, if you’ve got questions about startups, please ask. Reply to this email, contact me on Twitter, or find me on LinkedIn. And don’t forget to forward this email to other people who you think will like it. Thanks!
Children are great at asking the kinds of questions jaded, cynical, busy adults easily overlook. But if you’re willing to listen carefully, their questions can help you see things in the world that you’d completely overlooked. That’s what happened to me.
Peter Sunde - The Pirate Who Went to Jail for Your Illegal Downloads
In the early 2000s, online file sharing was a huge part of Internet culture and a huge problem for media companies who viewed piracy as an existential threat to their revenues. On the newest episode of Web Masters, I got talk to one of the people who made file sharing possible -- and went to jail for it -- Peter Sunde. Peter launched The Pirate Bay, the world's most popular torrent search engine.
Listen to his story on:
…or just search “Web Masters” wherever you listen to your favorite podcasts.
As someone who teaches entrepreneurship, I'll be the first person to admit that most startup mentorship stinks (myself included... I make plenty of mistakes with the advice I give!). That's why entrepreneurs have to get really good a filtering the advice they receive. Ironically, here's some advice on how you can do it.
Entrepreneurs don’t usually think about the role historical factors play in the eventual success — or failure — of their startups. But investors do. Are you pitching your startup in ways that help investors understand why “now” is the right time?
Office Hours Q&A
I keep emailing investors, but nobody is responding. I must be doing something wrong. Help! How do I get more investors to respond to my emails?
A lot of people advise against cold-emailing investors. I 100% disagree. I’ve had dozens of conversations with investors I’ve cold emailed, and I’ve even been funded by a couple.
But before I go any further, I need to contextualize my fundraising successes as they relate to cold emails. Yes, I’ve successfully raised capital from investors I’ve cold emailed. However, in both cases, I still spent months building a relationship with the investors before they ever invested. So it’s not like I cold emailed and had a check within a week. I still had to go through the same process of building a relationship. It just so happens that the relationship started via an email.
I bring this up because the way to think about cold emails to investors isn’t as a fundraising process. It’s a process for building relationships.
If I had to guess, this is where you’re making your biggest mistake. While I haven’t seen the emails you’re sending, I’m guessing you’re trying to “close the deal” with the email. By that I mean you’re trying to pitch your company for funding. But email is a terrible medium for making any kind of sale.
Instead, you need to dial-back your expectations. The only purpose of cold emails to investors is to convince those investors to have conversations. That’s it. Save all the selling, pitching, and fundraising for actual meetings.
Once you’ve reset your expectation for the email and realized it’s just a tool for setting up a phone call or Zoom meeting, the content of the email gets pretty easy. Here’s what you need to include:
A short (1 sentence!) explanation of what you do that clearly ties your startup to the investor’s interests and/or investment thesis. In other words, if you’re a seed-stage B2B SaaS product, you should be clear about that and only emailing investors who invest in seed-stage B2B SaaS products. Don’t waste anyone’s time contacting investors who will never invest in your type of company. (Read more about investment thesis.)
Some sort of “sizzle” to get the VC excited. For example, anything from “We’ve got three Fortune 500 customers” to “We’re already generating $500k ARR” to “We’ve been featured in the New York Times”. Whatever is going to get VCs excited, but, again, in only one sentence.
Either a link to your website or an attached one-pager with more details.
Specific potential times for meetings such as, “Are you available Friday at 2pm EST or next Tuesday at 11:30 AM EST?.”
And that’s it. The entire email shouldn’t be more than four sentences, tops. Here’s an example:
Hi [INVESTOR’S FIRST NAME],
I’m Aaron Dinin, creator of Web Masters, a podcast where I speak with some of the most successful early Internet entrepreneurs and innovators. My guests have included the founders of companies like AltaVista, GeoCities, MapQuest, Flickr, and Second Life, just to name a few.
Since I see you’ve recently been investing in business-focused podcasts, I’d love an opportunity to tell you more about my work, learn more about your investment process, and see if there are any opportunities for us to collaborate.
Are you available next Monday at 9:30 AM EST or Wednesday at 2 PM EST for a 30 minute intro conversation?
Short… sweet… to the point. Most importantly, I’m not trying to do anything more than get a conversation started. Send an email like that, and there’s a good chance you’ll get a response.
Also, before I end this answer, I’ll add two other things you should know about cold emailing venture capitalists:
First, if you do get a response, there’s a good chance it’ll be the VC introducing you to an associate. An associate is basically an intern whose job is to vet deals for the partner. That’s fine. It’s just another hoop to jump through. Be prepared to get the associate excited so he/she wants to schedule a follow-up call for you with the partner.
Second, if the VC doesn’t respond within two or three days, don’t take it personally, and don’t quit. Send a polite follow-up email and keep asking for the meeting. Sometimes it takes three… four... fifteen… maybe twenty polite follow-up emails, but eventually you’ll get a response.
Got startup questions of your own? Reply to this email with whatever you want to know, and I’ll do my best to answer!