Let’s start at the beginning. I have a full time job, and I donate much of my time in the noble pursuit of improving the state of entrepreneurship in America. In my free time I do some opining on Tech Cocktail and my blog, Forward Thinking. In the 15 minutes left over in my life after that, I dabble as an angel investor. Now if you happened to read my angel investor web page, it clearly states right there on the home page: It doesn’t take a rocket scientist to read that and understand that I invest in companies that are in the DC metropolitan region, and that those companies are B2B companies (not B2C, or biotech, or renewable energy, or Nigerian princes). “We source our own deals” means “don’t call me, I’ll call you,” but apparently this warning label doesn’t resonate with everyone. A couple of days ago I received the following email, which I altered to protect the guilty and remove some of the more ridiculous parts that would only make this post appear farcical. Do you or someone you know have a possible interest in investing in an internet start-up? The internet start-up is a website based search engine called “Dr. Ignorant Search” [Author’s Note: yup, he named it after himself]. If yes, please contact Dr. Ignorant at XXX-XXX-XXXX [Author’s Note: the area code is 1,000 miles from DC]. The internet start-up is a website based search engine called “Dr. Ignorant Search”. The search engine is free to use. It is geared towards anyone of all ages who seeks “enjoyment and, or knowledge.” [Author’s Note: wow, you can’t get more niche than that]. [Blah blah blah with absolutely no information that details the pain this product solves or what the monetization plan and business model are.] The goal is for the investor to receive a return of their principal in-full plus an additional 10% of their total investment (for example $10,000 interest from a $100,000 investment) from revenue generated by the search engine website. The associated risk is that the investment capital and, or interest, whole or in part, may not be returned and paid to the investor due to the advertising revenue falling short. On the value side for the investor, the goal of Dr. Ignorant’s search engine size is that of Google Search, which has excellent annual revenue from advertising. We (myself, my assistant and my website search engine developer) are available to answer your questions by phone, Skype or email. Upon request we will send to you the website address containing a working prototype of the search engine for your trial use. Again, this search engine is free for all to use. Thank you, Dr. Ignorant Now getting spam like this is easy to ignore, but this person then hunted me down and called me on my mobile while I was having dinner with my son. Dr. Ignorant would not get off the phone until I promised to read his email and call him back the next morning. So I promised to read the underwhelming email, and I replied with the following advice: Dear Dr. Ignorant, Couple things, suggestions and criticisms meant to help you in the future so that you won’t burn anymore bridges as you did with me: I recommend that you check out the Founder Institute, an organization dedicated to educating entrepreneurs so that they have a higher chance of success with investors prior to burning any bridges. Best of Luck,Mr. Cranky The lessons here:
Investors tend to file unsolicited business plans in their circular files – get a warm introduction.Do a little research, before asking for that warm introduction. Make sure you’re aiming at the right target. Does your intended investor invest in companies in your stage, sector and geography?
How you perform when you approach and pitch investors is a leading indicator of how you will execute your business plan. Don’t be an ignorant dufus.
