An investor list is a research output, not a contact list
Every name on a list should have a recorded reason for being there — sector, company profile, transaction structure, and geography. If the reason is not written down, the name is a guess.
There are two ways to build a list of investors to approach. One is to start from who you can reach. The other is to start from who invests in what you are.
The second is harder and it is the one that works.
Four filters
An institution belongs on the list if it invests in the company’s:
- Sector — not “software”, but the specific category the product sells into
- Company profile — stage, revenue scale, growth rate, business model
- Transaction structure — the instrument and the round shape actually being raised
- Geography — where the company is, and where the fund is willing to deploy
A name that clears all four is a candidate. A name that clears three is a conversation that ends politely in week two.
Write down the reason
We record why each investor is on the list. This sounds like bookkeeping and it is actually the control that keeps a process honest.
When the reason is written, two things become possible. You can rank the list, because you can compare the strength of the fit rather than the strength of the relationship. And when an investor passes, you learn something transferable — the pass tells you which of the four filters was wrong, and that correction applies to every similar name still in the queue.
When the reason is not written, a pass is just a pass, and the list gets worked to the bottom without ever improving.
Relationships are a route, not a reason
Industry relationships matter enormously for getting a meeting. They are not a reason to take the meeting.
The list is built from research first. Relationships then determine the order it gets worked and how the first approach is made. Reversing those two is the most common way a process ends up with a lot of activity and very little progress.