Starting a business is not an easy feat since there is so much to plan, develop and build. Although the product or service is always a priority, you have people to meet, employees to hire and funds to raise. Raising funds can make or break many enterprising start-ups. In fact, to get a good venture capitalist (VC) on your side, you will need a wicked PR campaign to get you off the ground. After all, if you cannot sell your idea to a VC, then you probably cannot sell it to consumers. Great press coverage not only puts you on the map of VCs, but can also bring better employees to your team at a lower cost. Ultimately, a talented team will attract better investors.
With this in mind, here are 8 PR tips to win over venture capital firms and raise those much-needed funds to get your start-up running:
Tips to Generate a Buzz and Win over the Venture Capitalists
1) Producing Content Yourself
Before you start your PR campaign, you will need a few things to ensure that journalists look favorably on your business and that you can truly harness all the beneficial effects of positive press. First and foremost, you need a website to receive traffic from any positive press. On your website, you need to identify your brand as an industry leader and innovative thinker within your field.
To this end, you should create a blog that sets you apart from other businesses in the same field and produces content that is valuable to your readers. If a journalist takes a look at your website and can see that you know what you are talking about, they are likely to paint you in a better light when it’s time to get down to the nitty gritty.
On the other hand, just because you create the content doesn’t necessarily mean that you are publishing the content. Indeed, writing guest articles on a variety of blogs that focus on your niche singles you out not only as an entrepreneur, but as an intrepid expert on the subject. With a good guest posting strategy, you can create network links that will become all the more important further down the line.
Furthermore, having a recognizable name in the industry will win over journalists and back up your business when you release your product. An identifiable name gives your audience something to believe in and helps you convince journalists and ultimately reassure venture capitalist firms. Within your own content, make sure you tell your story, sell yourself and establish yourself as an innovative thinker and expert in the industry.
Remember, publicity and press are not going to trick investors into believing that you are worthy of that venture capital fund that you’ve been dreaming about. In reality, publicity brings information to public knowledge. If you don’t know what you’re talking about, journalists, venture capitalists, and the public will see through you in no time. Talk about your topic confidently and correctly. Avoid only focusing on your product. Try to tie in facts and figures to support your opinions, and then bring in your product as further evidence that you know what you are talking about.
Takeaway – Use your blog to connect with readers and create a favorable image for the company.
2) Target a Trend and Expose it
Ideally, every news article about your product should be telling a larger story. Whichever market your product caters to, there will be a current trend or interesting hook that corresponds to that market. Identifying and exposing larger stories through product news draws more readers and highlights the importance of your product.
For example, if your product is an innovative home solar energy system, you should expand on market trends. It can be especially useful to talk about the rise in renewable energies, the number of people currently off the national grids in a number of countries and environmental issues. If possible, find an example where your product reflects this information in a gripping way. Are energy prices rising as oil prices inflate? It’s well documented that fossil fuels have caused a greenhouse effect, so find those studies and use those numbers.
Before speaking with the media, producing a press release, or contacting a venture capitalist firm, ask yourself the following questions and make a note of them alongside your business plan:
- What size of market does your product cater for?
- How fast is the market growing, and what numbers do you have to back this up?
- Who are your competitors and what position do they play in the market?
If you approach media outlets or journalists with the answers to these questions, then more journalists will be interested and potentially write your story. Beyond that, the journalist can create an engaging hook to reach a much wider audience. With a more relevant and further reaching article that features your business, you can generate more hype. Ultimately, this will earn you more interest from venture capital firms.
Takeaway – Pay attention to current events and harness this news to create stories around your product or service.
3) Develop a Story for your Product
A good story sells. That’s a truth that has been proven in the marketing world time after time. Copywriters have been crafting narratives to sell stories for more than 70 years. Narratives inspire customers, journalists and venture capitalists to act on your product. By creating a story that can be modified and adapted, you create empathy between your audience and your business.
Create a concise, yet comprehensive narrative that can grow with your business. As your business changes, your mission will need to evolve with it. Your story needs to define your business’ vision, communicate your strategy and encapsulate the world your product inhabits.
If your audience doesn’t have time to read through your whole business plan, you will want them to gain everything they need to know from your story. Who you are. Where you come from. Where you’re going. What do you value and why are you unique? Your story has it all. Studies have shown that our brains think of companies not as large groups of people with a unifying purpose. Rather, we treat companies as individual human beings. As such, the narrative of your business is the soul of your company, the element that makes it human.
At Pressfarm, we encourage start-ups to develop strong narratives to engage with journalists. Doing so will help them create a hook and publish a positive news story. One of the best techniques for creating a strong narrative is establishing a ‘shared purpose’. Simply put, a shared purpose is the idea that you and your customer are working towards the same goal.
Going back to our home solar energy system example, your shared purpose would be something along the lines of protecting the environment by reducing reliance on fossil fuels. This is quite clunky and long-winded, so perhaps simply including something like “Protecting our planet”, would create a stronger narrative. Both you and your customer have a shared purpose and undertake the struggle together, not as consumer and provider, but as collaborators.
Oh, and a final piece of advice on narrative: keep it simple! People are simply not interested in what they don’t understand.
Takeaway – Create a strong narrative for your product or service and use this to inspire interest within customers and journalists alike.
4) Identifying the Right Investors & Testing Interest
There are a million and one venture capital firms in the world, and even if you could pitch your business to all of them, you wouldn’t want to. After all, some are far better than others. To be effective in your investment pitches, you need to identify the right VCs and properly gauge their interest so as to not waste anyone’s time.
The first step is the initial screening, where you target investors who have invested in companies in a similar situation to your own.
You’ll be focusing on four things – VCs who have invested in:
- Your target industry.
- Companies at the same stage of development.
- Similar amounts to your fundraising goal.
- Your geographic location.
Most VCs will want to invest in businesses that are local to themselves (up to three hours away) and in industries that they are experienced in and have an eye for. Certain investors will only support companies at certain stages of development and with limits to the amount invested. It’s important to focus on these four criteria before moving on to the second stage of screening.
Once you’ve filtered out the majority of VCs who will throw your pitch straight to the wayside, you need to consider where to focus your best efforts. Target VCs who are experienced with start-ups, especially those with experience in your target industry sector. The best VCs are those who:
- Currently have other investments that will complement your own business.
- Exhibit an interest in developing your business and increasing your investment appeal.
- Have strong links to individuals and companies that will help develop your business.
- Are willing to invest more than money (for example; time, skills and manpower).
- Are well connected in the investment community and can attract co-investors to raise higher funds.
- Have a proven track record of making investment deals.
- Have a history of building businesses and successful exits.
A list of venture capital firms will soon be available from the National Venture Capital Association.
Takeaway – Take time to filter out Venture Capitalists and identify the most suitable targets.
5) Reaching out to VCs
So you’ve generated some positive press and created something of a buzz around your product through a successful PR campaign. You’ve got the perfect venture capital firms in your cross-hairs. This is when you need to approach them.
Though most venture capitalists have a generic email listed on their website for business proposals, this might not actually be the best avenue to use when you’re reading out. Most venture capital firms receive thousands of pitches every year, so your great idea can become just another raindrop in the ocean.
Keep your hit list concise and accurate, and then start finding ways of getting a personal introduction. Many top investors claim that if you can’t find a way to grab an investor’s attention or source an introduction, then you probably aren’t much of an entrepreneur.
So get creative and pay attention to various VCs and try to open those important channels of communication. These days, networking is key, so you should be creating industry links with as many people as you can – hopefully one of these contacts can point you in the direction of a venture capital firm that helped them grow.
Takeaway – Avoid generic writing and use networking to leverage your relationships instead of firing out emails that nobody will ever read.
6) Pitch Your Product to Journalists
Getting those initial articles about your product can be daunting. At least, meeting journalists who have very little time is daunting. Keep your media pitch, ideally under two minutes, and win them over as quickly as possible. Journalists have a good eye for a story, so mention your product’s narrative and highlight any trends that your product ties into. Entertain the journalist. Sell them your story, and sell them your brand. Make sure to highlight any challenges you’ve overcome, where you’ve come from, and how your product will change your customers’ lives.
Read through some of the journalist’s previous articles and make sure that they’ll be interested in your product. Getting a 100% positive review is next to impossible. To improve your chances, make sure you target the right journalist, one who will be interested in your product. By doing this, you’ll get a much higher chance that they’ll overlook or outweigh their criticisms and sell your story (and your product) for you.
The importance of good research
When approaching journalists, good research is key. Use services like the media database Pressfarm offers to contact journalists. With this database, you can connect with over 1 million journalists across different industries. With the database filter, you can narrow down your search as much as possible by only focusing on those who write within your field. It’s almost the same as when you write up your hit list for venture capitalists. After all, there’s no point in contacting food journalists when your business is marketing a video game. Pressfarm also helps you create content that journalists can’t turn down. These include press releases, guest posts and media kits.
When contacting journalists for the first time, be quick but concise. Try to get as much information as possible and make sure you write every email as personally as possible. Avoid sending anything that looks even remotely like spam and never put attachments into an email. Journalists simply won’t open these for fear of viruses.
Ideally, contact journalists via phone, text message or through a face-to-face introduction. Use whatever methods you have at your disposal without becoming a nuisance. In the world of business, an ingenious introduction will only prove your entrepreneurship.
Takeaway – Be quick and concise with journalists. Use your product narrative to gain traction and help these journalists establish a newsworthy title.
7) Use PR Collateral to Create Traction
Track the impact of your publicity and inform your investors and potential investors. This not only keeps current investors updated, but shows a level of professional entrepreneurial talent and gets them talking about you. By being at the forefront of your VCs’ minds, you create traction and raise your profile and as a result, your investment appeal.
The word traction gets thrown about when discussing venture capital funds. So what exactly is traction? Unfortunately, there’s no single definition, but a whole multitude of things contribute to the mysterious traction. Sometimes, it’s just proving that you’re making progress with your customers. Sometimes, it’s developing your product or your sales channels. Other times, it’s just having some initial revenue to prove that you’re serious.
You may have been denied venture capital funding before because your business plan was good but you didn’t have enough traction. If this is the case for you, then updating these semi-interested VCs with positive PR material is the perfect way of proving that your business is a safe bet when the VCs are investing their money. Ultimately, traction requires building a relationship with a specific VC over time and establishing empathy, trust, and rapport. If you can prove to a VC that you can move the business forward, then they will be much more inclined to invest.
The importance of reaching out early
It might be worth reaching out to VCs early on in the lifespan of your business. By reaching out early, you give your business time and space to grow whilst on the radar of any individual venture capitalist. It’s much more powerful to see a business go from nothing to well-developed and gaining positive press in a matter of months. This view of fundraising proves that earning investments isn’t a one-time thing. You don’t pull in the big investments with a single email, but with consistent and steady progress over a period of time with a venture capitalist. If your business is in it for the long run, then your fundraising efforts should also focus on the long run.
Depending on the rules of your initial investors, you might find it possible to seek extra investing or alternative funds. Using positive PR campaigns and press collateral, a history of positive investments and good initial sales, you can springboard onto the radar of bigger and better investors, and raise even more capital than you initially dreamed of. Make sure to capitalize on further investing by using your initial VCs as examples.
Takeaway – Get started early on with creating traction and use publicity to nurture relationships that can help your business with funding.
8) Spreading your Media Coverage
Once your journalist’s positive piece has been published, make sure you distribute the article as widely as you can. You might be excited to see your name in ink alongside bold headlines. Unfortunately, if it’s only in your local paper with a circulation of 1000, you’re probably not going to be piquing the interest of the biggest investors in your field.
Thanks to the internet and social media, news stories have the capability to be spread around the globe in a matter of minutes. Great stories featuring incredible products and hot businesses are released and re-posted every day. Each share is essentially republishing and reaching even more people. That’s more potential customers and less risk for the VCs.
As this is the last tip we’re going to share with you, now seems like a good time to remind you of what we talked about in the beginning of this article – creating your own content. If you can produce viral content, especially well-produced videos, you can reach huge audiences extremely quickly and back up every piece of positive press you receive.
Social media marketing works on the principle of snowballing. If you target opportune locations, you can share positive press to 10 places. These will then be shared 10 times each, and again, and so on, dramatically increasing your digital footprint.
You can share positive press through a number of channels:
- Email your customer database.
- Post on social networks (Facebook, Twitter, Linkedin, Instagram, Pinterest etc.)
- Ask friends within the industry to share on any social media, blogs or web pages that they may control.
- Link the article on your company blog and website.
- Inform your local news outlets about the coverage, who will often do a follow-up story.
Often, news publications and outlets share stories and use each other’s sources to produce their own stories. For this reason, one positive article can turn into multiple positive articles. Ultimately, the further a story spreads, the more weight it carries. The more weight it carries, the more your potential VCs will take notice.
Takeaway – Do not rely on journalists to spread the news. Use marketing and social media strategy to emphasize these efforts and take your promotion efforts to the next level.
Public relations and raising capital are integrally related. One will always influence the other. Better investing creates more media buzz and gets more journalists taking your business seriously. Positive press will create more interest among venture capital firm. In order to generate this positive press, we recommend creating a great press release, including a narrative and an effective business plan. We are trying to drum up interest among journalists who specialize in your industry sector. Once they’re on board with what you’re trying to do, the venture capital firms will soon follow suit.
And remember, PR and raising funds aren’t one-off tasks at the start of your business. This is a long race and you need to keep everyone interested throughout your company’s lifespan.