Via Intro Paths
If a user knows Investor X, and if that investor has previously co-invested with Investor Y, then the user can get an introduction to Investor Y via Investor X. It is, however, important to understand the nuances involved here, and to focus on specific types of investor introductions that do not carry a signalling risk.
Introductions via Non-Existing Investors
If a user knows Investor X socially or professionally, and if Investor X knows Investor Y, then it may or may not be fair for Investor X to introduce the user to Investor Y. Let’s look at a few scenarios with different context windows:
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Not Received Favorably: If the investor passing along the note has historically invested in the user’s stage, sector or geography, and has decided to not invest in this scenario, then the introduction will carry a negative signal, and may not yield a favorable outcome. Investor Y will rightfully question why Investor X is not investing herself, but is passing along the opportunity to others
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Received Favorably: If the investor passing along the note has historically NOT invested in the user’s stage, sector or geography, then it is fair for that investor to introduce the user to others within their network. In this scenario, the question of why Investor X is not investing is already addressed, as it is outside of their focus area
The above consideration requires a well-researched and nuanced approach when requesting introductions from investors that have not invested in your company.
Introductions via Existing Investors
The best form of introductions will come from your existing investors. Such introductions tend to have a positive signaling effect if and when your existing investors are also investing in the upcoming financing.
Introductions via existing investors are the norm in venture capital. Users that build a strong relationship with existing investors tend to comfortably get introductions. In most cases, however, a user’s existing investors will be cautiously optimistic, and will make a finite number of introductions. It is up to the user to ensure that introduction requests are well-researched and are targeted toward the “most likely” investors.
Research to Identify Co-Investors
In an ideal scenario, users may want to approach their existing investors (or other investor connections) for introduction requests that are well-researched and highly targeted. Tactically, this can be achieved via the following steps.
As a first step, users can use Metal’s “Other > Co-Investors” filter to identify all co-investors for their existing investors. Users can then apply additional filters to limit search results to investors that meet their criteria (activity, stage, sector and/or geography).
As a second step, for each identified co-investor that is relevant to the user’s Company, founders can look up the portfolio founders for the co-investor, and then identify which portfolio company is a common link between the targeted investor and the user’s existing investor. Additionally, using the “Deal Intelligence” sub-tab, users can also identify which investments, if any, are particularly similar to the user’s Company.
As a final step, users can author a compelling note to request an introduction from the existing investor. Showing the level of research conducted is a great step toward ensuring that the note is perceived as one that is highly targeted and compelling. An example is noted below:
*“Hi John,
Thanks for offering to make potential introductions for our upcoming raise. As per our preliminary research, we have identified Investor X as a particularly strong fit. They have made * and have been particularly active in our sector. Interestingly, they also invested in Company X that operates in a similar space as us.
I noticed that one of your portfolio companies (ABC) raised from Investor X back in 2022. Would you be open to introducing us to the founders at Company ABC (as an opportunity for us to learn about Investor X and their process).”