ffVC Partner David Teten speaks about capital raising from the investor’s perspective at the Founder Institute. David explains that individuals are inclined to invest in those who are similar to them. It is easier to keep tabs on individuals within your network, and therefore investors are able to keep tabs on their investments. It becomes easier to know when to buy and when to sell according to milestones in the business, or even personal details about a CEO that may drive business in a particular direction.
CEOs can look to market themselves through online investing communities in order to target investors interested in their space. CEOs should also look to target individual decision makers, and not a venture capital firm as a whole. When reaching out to these individuals, carefully personalize each email so it can never be mistaken as spam.
The cheapest networking tool is keeping careful track of the people you meet. Even if the person does not seem to be a promising investor, perhaps someone they know is -- it is always important to keep doors open.