How to secure your first round of investment: StayUncle story
Many people have asked us – How did you guys manage to secure investment so early?
Today, it is time to unfold our magic bag. There is one thing we are keen on bragging here at StayUncle (apart from the great team).
We never approached an investor directly. They did!
How did that happen? We didn't have an ultimate strategy or secret recipe. We weren't that intentional about seeking investors either. Unfortunately, many startups are. Instead of pursuing customer happiness, they pursue investor happiness. Instead of pitching to early adopters and bring in customers they spam investors databases.
Let us reveal how things played out for us. You may learn something as well.
Hack #1 – LinkedIn contact list
One thing we knew for sure. We must spread the word about StayUncle and the hourly hotel booking concept well before the launching date. We started around a month ago before the launch. We wish we had started at least two months before.
We are not techies and we were not very good at designing highly converting landing pages or referral mechanisms. Therefore, we shifted our focus to our true strength.
We designed a mailer inviting people to check us out. Nothing fancy but still compelling enough and personal to draw some interest.
Next, we needed database of contacts and emails to disseminate the campaign. Purchasing email database was out of question. Instead, I decided to conduct a small hack that has served me well in the past too.
Database of LinkedIn email IDs.
A common email database is likely to end you up in the Spam folder. However, LinkedIn email IDs are highly relevant. We extracted our LinkedIn contacts and told (enforced) some of our close friends to do the same. A startup's gotta do what a startup's gotta do. Don't do this too often and only do it with people you are close to and trust.
In just a few days we collected around 10,000 LinkedIn email Ids.
Book a hotel under your own terms!? I still don't know how I came up with this one. Over the course of the next few days, around 10,000 people active on LinkedIn received this. We used five Mailchimp accounts. No segmentation. No particular focus. We were firing in all directions with a single aim of spreading the word out.
However, we were particular that our correspondence was light and personal, letting people close it or proceed in matter of seconds.
Gradually, new subscribers started rolling in. The landing page was also doing a good job. We maintained a stable 10.5% email click-through rate and 40% subscription rate.
Every time a person subscribed for our launching update he got a second follow up from us.
I have personally subscribed to a number of launching campaigns so far. Only a few of them used to grace me with a personal followups and further correspondence. The rest of them thought that automated email response was a better idea than personal conversation in this era of interactions. A bad strategy for a startup.
Then after a few days it happened:
Interactions are a fuel for the heart of every entrepreneur. However, this interaction went even further. After a few emails exchanged, Ajay declared he would love to invest in the concept of StayUncle and the founding team. We were mesmerized.
The verbal deal was sealed at Cyber Hub in Gurgaon.
If this doesn't work, then you can consider Hack #2
Hack #2 – LinkedIn Pulse
This will work well for you if you are an avid LinkedIn user and publish regularly through LinkedIn Pulse.
- Step 1 – Prepare a compelling blog post which you are going to publish on Pulse.
- Step 2 – Have a ready-made list of Angel investors you would like to connect with on LinkedIn. Connect with all at once.
- Step 3 – As soon as a few of them accept your invitation publish the blog post via LinkedIn Pulse within the same day.
Every time you publish via Pulse, all your LinkedIn connections get a notification and represent potential readers.
Because you have connected with prospective investors just a few hours ago, they are likely to remember you and will check your post. Here is an example that worked for us and that brought Matrix Partners to inquire about us.
Here are some takeaways for you fellow entrepreneurs.
Content Marketing works awesome for startups
From the very beginning till now and probably in the future, content marketing has worked awesome for us. People who haven't yet heard about us have heard about the StayUncle blog. Developing your own voice is the best way to ensure success for your startup.
Start the practice immediately. Write the hell out of you. Check out the official StayUncle blog and see how we do it.
Interact, Interact, Interact
Pay attention to every email, every comment. Drive conversations. As many as you can.
Drive customer happiness, not investor happiness. The former are easy to please.
Look beyond your objective.
We got people subscribed to our updates. Now what? You have to take it further. You have to make them love you. Talk to them. Give them stuff.
How did you manage to secure investment for your startup? Any specific tip you want others to know. Share in the comments below.
About the Author:
Blaze Arizanov is StayUncle's Chief Marketing Uncle. His main gig is to tell stories and take StayUncle into new uncharted territories without being marked as the enemy on the state. Connect with him via Twitter and LinkedIn or catch him up on the Spillover Blog