When embarking on raising venture capital, every entrepreneur has heard the advice, "don't cold call VCs, get introduced to them." In my own personal experience, when you're just starting out and don't have a lot of personal VC contacts and relationships, that's easier said than done. When you say "network" to most people, they envision schmoozing with professionals, playing golf, going to dinners, etc. I have always felt that schmoozing helps, but isn't sufficient (or efficient). Luckily, in the internet age, we have a bunch of tools to help. So having gone through the "how do I get introduced?" process, here's a couple of tips for entrepreneurs looking to connect with VCs:
(1) Find out who you know. How many people do you know? This used to be a very time consuming, manually intensive question to answer, but fortunately, today there are a number of tools for the aspiring VC-backed entrepreneur to figure it out. This sounds stupid, but first among them is MS Outlook. Take an afternoon and put all of the paper business cards that you have collected over the years and put them in Outlook. Then go through your Hotmail and Gmail accounts and put all of your friends and acquaitances in Outlook. Odds are you'll have a few hundred contacts or more when you're done. If you've been diligent about keeping your Outlook contacts up-to-date over the years, you might have a thousand...a great start! Now, going forward, every time you "meet" someone (could be just an email interaction), immediately put them in Outlook. LinkedIn (more about this service later) has a great feature called "grab" in their downloadable Outlook plugin. It allows you to highlight the signature in someone's email and automatically generate an Outlook contact. Get it and use it!
(2) Keep your contacts up-to-date. The average person changes jobs every couple of years, even if it's just a move within their existing company. With a few hundred people or more in you Rolodex, you're bound to have out-of-date info for a good half of your contacts. The best tool I've found for managing this updating process is Plaxo. With over 15 million users, most of them professionals, this is a great tool to keep track of your contacts changing details. About 20% of my 2,000 contacts in Outlook are synchronized using Plaxo.
(3) Find out who your contacts know. I'm a huge fan of LinkedIn. If you're not a member already, you should definitely join. There are some 10 million registered users and it really is a great networking tool. If you download the LinkedIn toolbar which is a plug-in for Outlook, it will scan your Outlook contacts and identify people you know who are already LinkedIn members. Send them invites. They're already LinkedIn users and they know you which is a great way to start finding out who your contacts know. Once you have 50-100 connections on LinkedIn, you'll be able to "get introduced" to almost any VC there is through someone you know.
(4) Make it a habit. If you allocate an hour or two per week to managing your network as mentioned above, in less than six months you'll find that you have "one of the biggest networks" of anyone you know.
If you have everyone on your management team do the above 4 things, I guarantee that you'll be able to get 2 or 3 intros to pretty much any VC firm that you're interested in pitching.