Precision Targeting
Identify investors that invest in rounds identical to yours.
When qualifying investors, founders should operate on an elimination criteria that helps filter out investors that aren’t necessarily the best fit. Our recommended elimination criteria is shown below:
Sector Familiarity: Has the investor made at least some investments in our parent sector?
Investors that have never invested in your parent sector may still consider an investment in your space, but they are probably not the default go-to investors for your Company. All else being equal, investors that have previously invested in your sector are more likely financing partners.
Recommended Criteria — At least “1” investment in the user’s parent sector in the past five years.
Stage Focus: Does the investor specialise at our stage?
This is often the most critical elimination criteria. Most investors have a clear and specific focus in terms of the stage at which they like to invest. You can learn more about round stages here.
Recommended Criteria — At least 10%+ of the investor’s total investments in the user’s stage.
Inclination to Lead: Does the investor lead rounds at your specific stage?
Via the investor profile, users can identify the percentage of a given investor’s investments that they have led at a given stage. In the event that you are looking for a lead investor, know that investors that have historically led less than 10% of their total investments are not likely targets to lead rounds.
Recommended Criteria — At least 10%+ of prior investments led in the user’s stage.
Geo Focus: Has the investor previously invested in your continent?
Most investors tend to be less adventurous with investing in continents that they historically haven’t invested in before. The most likely investors are typically those that have made at least some investments historically in your continent.
Recommended Criteria — At least “1” investment in the user’s continent in the past five years.
The above elements help founders achieve precision in the set of investors that they decide to pursue. While the above list is not designed to be exhaustive, it does provide a strong starting point to drill down on the “most likely” financing partners.