How to Broaden Your Search for the Right Investors

two people making money deal

If you’re part of an accelerator or startup, the SEC just granted you a new way to approach funding in 2014: the right to solicit a broader range of investors.

I wouldn’t jump the gun on this opportunity too quickly, though — there’s a bit of fine print to read first. For one thing, the new, relaxed rules on “general solicitation” are subject to change.

What You Need to Know About This SEC Change

In response to the JOBS Act, the SEC is now allowing startups to advertise their stock to investors. Many people believe this gives companies free rein to go after money — an assumption fueled by crowdfunding platforms like Kickstarter and Indiegogo.

In reality, you and your legal team have to take more precautions to ensure the buyers are accredited, which essentially means that they’re financially capable and know what they’re doing. If you don’t know a buyer, you must do the appropriate research to confirm the investor is accredited.

Besides researching the legality of an investor, startups and accelerators also have to work on their marketing strategies. To fully enjoy this new opportunity, founders must know how to attract the right investors and then reel them in with the right pitch.

Marketing to Investors

Here are three marketing tactics to help you find the right investors.

  1. Leverage the power of social networks. LinkedIn is a great place to start looking for potential investors. Try posting enticing information or even direct messaging some of your connections.
  2. Look into crowdfunding websites. Crowdfunding websites curate and position business concepts to a community of potential investors. If an investor is interested, his contact information is passed on to the startup. Research the crowdfunding sites that fit your industry best.
  3. Utilize community events. Community and public events are excellent ways to solicit interest in an exciting business opportunity. By getting exposure at contests, trade events, and other public displays, you can generate investor curiosity.

Pitching to a New Audience

Once you’ve garnered investor interest, the next step is creating the right pitch. Historically, pitch decks were targeted at investors who knew the company well. When marketing to a more general audience, you must work with a different set of assumptions.

Not all investors will understand the business, let alone the market opportunity. The pitch has to be broadened, well-supported, and designed to attract the right potential partner. Think of it as fishing: In a small pond with fewer species, you know exactly which type of bait to use. With a huge lake, you’re making an educated guess.

Crafting Your Pitch

To give you more than a shot in the dark, here are some guidelines to craft a successful pitch.

  • Clearly show the potential for return. Investors are interested in how an investment can mature, earn a profit, and get them a nice multiple on exit. Explain how scalable the opportunity is, the size of your market, and how disruptive the product or service will be to this market. Most importantly, clearly explain how you plan to earn revenue.
  • Don’t get caught up in “how it works.” Many entrepreneurs get caught up in the technical details when pitching their business ideas, but investors don’t care nearly as much about how something works as they do about the potential impact it will have on the market. 
  • Ensure you’re pitching the right investor. The wrong partners can be toxic. As you discuss your business idea with investors, consider whether or not they’re a good fit for your startup. Just because they have money doesn’t mean they’ll make good partners. (This goes beyond ensuring investors meet the criteria in the regulations.)

In addition to the guidelines above, the key is giving the investor confidence that you haven’t invented the numbers or the market opportunity. You want to convey that your prospects are very real in a way the investor can understand.

These newly relaxed rules don’t give you carte blanche, but by doing your homework, marketing to the right investors, and carefully considering each prospect, they could create a great opportunity for your business.

Alex Friedman is the co-founder and president of Ruckus [], a full-service agency, tech partner, and accelerator that is devoted to helping businesses grow. At Ruckus, Alex has been at the forefront of developing technology for nearly a decade, advising entrepreneurs and growing brands and Fortune clients alike.

The Young Entrepreneur Council (YEC) is an invite-only organization comprised of the world’s most promising young entrepreneurs. In partnership with Citi, YEC recently launched StartupCollective, a free virtual mentorship program that helps millions of entrepreneurs start and grow businesses.

How to Know Which “Exit Strategy” Investors Want to Hear


From Shockwave Innovation

You’ve just completed a great investor pitch with heads nodding and good interaction.  You’re about to ask “Does this opportunity interest you enough to explore an investment?” when instead you get a final question:


“One final question.  What is your exit strategy?”.

Oops, the last two times you got this question you were met with a sour look.  The first time you wanted to show you aren’t looking for a quick-flip and so you answered something like, “We’re not even thinking about selling the company or doing anything crazy like an IPO”.

The next time you decided to show the investor you want everyone to get a payday and so you answered something like, “We’ve already identified six companies that surely will want to acquire us as soon as we’ve reached $5M in revenue.  They are A, B, C, D, E and F”.  In this blog post I’ll explain why you got the sour looks and suggest a different response that aligns nicely with both company and investor interests.


Inside the Investor’s Mind (Infographic)

Without a doubt, Funders and Founders is one of the best places to find startup infographics. Anna Vital has some beautiful graphics that are both inspirational and/or educational.

This one caught my eye as I was perusing the site last night. The inner workings of an investor’s mind are often a mystery to first time founders. What exactly do you need to prove to get investment? What is the investor judging you on, as you nervously ask him or her for hundreds of thousands of dollars.

The answer, as this infographic shows, is, “A lot.” There are a million things that go into an investor’s decision to put money into your company. Some things you can control, like the size of your team and the quality of your product. Some things you have no real ability to forecast yet. How many rounds will you need to build your company, and how much will that dilute the original investor’s return?

However, many times the things that are complicated are also simple. What is an investor looking for when he or she is introduced to your company? SoftTech VC Managing Parnter Jeff Clavier summed it up in the “3 Asses Rule”: smart ass team, kick ass product, and big ass market.

Of course, you really can’t know everything an investor is thinking. Even the graphic below is only the thought process of one particular VC. Still, it’s a safe bet that if you’re following the “3 Asses Rule,” it won’t be too hard to raise some capital.

*Infographic from Funders and Founders.

Here’s A Way Not To Get An Investment From Mark Cuban

Mark Cuban (c) hanging out with nibletz co-founder Nick Tippmann (r)

You may have heard through the grapevine that Mark Cuban is an aggressive investor in early stage startups. Take the Shark Tank out of the equation and Cuban is still eager to invest in good technology.

Many people also know that Mark Cuban is one of the nicest and most approachable billionaires in the world. You can pretty easily find his email address online and if  you’ve got a good question or a good pitch he’ll actually respond to you.  Heck he’ll even let you talk smack about basketball.

But earlier today one startup founder took the absolute wrong approach to win over Cuban’s ears and investment.  It seems that this founder is in the process of closing a round. He apparently has a commitment from Peter Thiel and wanted Cuban to get in as well.

So what does he do? He emails Mark Cuban with the subject line: “Peter Thiel invested so you’re lucky I’m emailing you”.

Cuban took to Twitter for his response:

Mark Cuban, Startup Tips, investment, Shark Tank

Cuban than tweeted this message to follow up:


Boulder: Foundry Group Closes Third Annual $225M Fund

The Foundry Group, the venture capital group founded by Startup Colorado Co-Chair and Techstars Co-Founder, Brad Feld has announced that they’ve just completed raising their third annual $225M Fund.

As our friends at PE Hub are quick to point out the fanfare around the announcement was exactly the same as the previous two years. That’s perfectly fine with us though as Feld and his team are extremely busy and just about everything that he does is focused around funding, promoting and pushing entrepreneurs and Startups, and a lot of them are “everywhere else”.

For instance, Feld still serves as a mentor at TechStars and several other accelerators that are part of the Global Accelerator Network.

As far as the fund itself goes it will continue to invest in US based Startups and technology focuse companies. They prefer to invest in themes that have long term growth strategies in place rather than looking for the next Instagram. They often provide follow on funding for Techstars graduates. For example, The Foundry Group invested $5 Million in Orbotix Series B Round. Orbotix was mentored by Feld at TechStars. They created the Sphero robotic ball that even President Obama is a fan of.

Other notable investments include Cheezburger, Urban Airship, FullContact and Zynga.


Check out Feld’s blog here

Nibletz is the voice of Startups “everywhere else” here are more startup stories from “everywhere else”

Wait what’s This?


Kansas City Startup: AgLocal Raises $1 Million Dollar Seed Round

We told you about Kansas City startup AgLocal back in April. This innovative startup is connecting meat lovers with real meat, direct from the farm, effectively cutting out the middle man which is commonly the grocery store.

Real true meat lovers want to make sure they have the highest quality cuts of meat without the worry of chemicals involved in processing or trickery used to make the cut weigh more with additives and such that are commonly found in meat packaged at national food chains.

While the vegans and vegetarians of the world may not like the idea behind the Fairway, KS based startup, farmers love it. According to the Kansas City Business Journal, AgLocal has already signed up over 100 farms to be part of it’s direct to consumer network.

Founder Naithan Jones is hoping to grow AgLocal organically (no pun intended) and sees a vision where anyone in the US can pick up their mobile phone and use an AgLocal app to get the best meat delivered to their door.

AgLocal has secured a $1 million dollar seed round led by local investors OpenAir Equity Partners.

Jones left the Ewing Marion Kauffman Foundations Aspiring Entrepreneur FastTrac Program to undertake starting AgLocal.

Jones plans on using the money to add more engineers, build out it’s technology platform and increase partnerships with local farmers.


For more on AgLocal visit them here

Here’s an earlier story on AgLocal from Nibletz the voice of startups “everywhere else”

Here are more stories from “everywhere else”

Nibletz could really use your help with our mission, here check out this link.

Latest Rumor: Mircosoft To Buy RIM?

The interwebs are a buzz today about the latest rumor involving Waterloo Canada based RIM/Blackberry. According to financial website Microsoft is allegedly about to invest $3.5 billion dollars into the company.

This comes as a surprise and out of left field so of course we take it with a grain of salt. It doesn’t make that much sense either. RIM has been steadily losing market share due to Apple and Android’s stranglehold on the smartphone OS market.

RIM did release a product earlier this month that allows Android, iPhone and RIM to play nice in the next iteration of Blackberry Enterprise Server, which they are calling “Mobile Fusion”. RIM is also expected to release their Blackberry 10 devices which will utilize the QNX platform, the same platform on the Blackberry Playbook.

Microsoft has been desperately trying to gain traction with their Windows Phone 7 products. The first of their Nokia Windows Phone 7 handsets have hit the market however they haven’t made any significant gains in market share.

Perhaps putting the two failing operating systems together would amount to one working, worthwhile system.

Another Day, Another Possible Black Mark On Pinterest

Another day, another possible black mark on Pinterest. The site that has been marked in the past with Link Baiting, Spam issues, and copyright infringement maybe up to it one more time. Business Insider is reporting that “VC’s” are trying to get a new round of investment valued for the company at around $1 billion dollars. There is just one problem with that, everyone they’ve called to talk to has denied it with no known knowledge of a new round. Nor does Pinterest “want” to raise a new round of funding as of yet they claim. This is also a company that still has no business model for revenue yet as their past one with links didn’t work out.

What they are hearing is VC’s are trying to bribe and are showing up uninvited to Pinterest in hopes of starting those talks.

Could it be a rogue investor trying to drum up more interest as one of the original investors as either bringing more money in or a possible exit plan? Or could it just be that Pinterest is trying to drum up hopes of another round, so that hopefully someone buys them out instead.

Source: Business Insider

Clio Raised $6 Million In Its Series B Round Of Financing

Clio is a cloud based legal management software that has gained speed in the startup sector. They have recently raised $6 million in its Series B round of financing to use for hiring more staff and marketing its services.  Acton Capital Partners, existing investors and Point Nine Capital were the investing parties that helped make it happen in this round.

Co-founders are

Jack Newton (CEO) – An experienced business leader, software developer and entrepreneur, Jack provides strategic vision for Clio, and is helping to raise the profile of cloud computing in the legal profession.


Rian Gauvreau (COO) – Rian combines his years of experience with law firm IT with his in-depth software development experience to help create software law firms love to use.

The complete Clio team list

“Completely web-based, Clio is a practice management system that is specifically designed for solo practitioners and small law firms. Your important client data is securely accessible anywhere—from your PC, your Mac, and even your iPhone.”


Clio pricing is $49 a/month for Attorneys and $25 a/month for Support Staff. A very affordable option for any lawyer looking to tidy up their schedules, billing and many other business related needs on the go or in the office.

Via Clio