How TheLadders Raised $650,000 In Angel Money Via Email

There are lucky, fortunate, brilliant people who have the right entrée into the right environs in Silicon Valley who are able to raise angel money by dropping a leetspeak tweet early enough in the morning to close the round that day. 

If you are one of those people: congratulations!  There is nothing I can add to your success, and I hope you realise how fortunate you are to live in America in the 21st century.

But maybe that’s not you, and I certainly know that in the fall of 2003, that wasn’t me.  I wasn’t lucky or fortune or a brilliant seer into the future, and angels were most definitely not beating a path to my door.

I was a kind of successful loser: I’d managed to avoid a paycheck for a year and a half after helping to sell HotJobs to Yahoo!, and I was hustling to get back into the online recruitment business with an outlandish idea about helping the top 10 per cent of America get into their next job.  But I wasn’t connected, I wasn’t in Silicon Valley, and I certainly didn’t have the finger-snapping ability to conjure up a million bucks for my curious fantasy.

But I had a story.

And the way I raised $635,000 in February of 2004 with my co-founders at was to share that story — our story — with the right audience.  I’d send emails, like the ones below, to our potential investors weekly — short, sharp, to the point, celebratory emails that shared our passion, our excitement, our challenges and our adventures. And with this approach, we ended up raising more than the half million dollars we’d set out to raise.

So before telling you how smart and clever we were and how you should be just like us, let me share with you my lack of qualifications: I know nothing about raising angel money, having only done it only once seven years ago, in a business closely related to the industry I’d just exited, from a group mostly composed of financial professionals and attorneys located in Manhattan.

In other words, the one time I’ve done this right, I was a goofy newbie whose dumb luck overcame not having a whit of experience or street cred.

But the way to overcome any of our disadvantages in life is to focus not on what you could have if you were somebody else, but on what you do have here and now.  And as an entrepreneur, you have a passion that attracts an audience, you have a story that people love hearing, and you have an opportunity for them to be a part of it without their risking everything by writing a check when you close.

That’s what we did in the winter of 2004, and how we got to where we are today…

Get an audience.

Professional angels like Ron Conway, the Lerer Group, and Dave McClure are wonderful, insightful, clever, successful people, who I would love to work with if I were raising an angel round today.  Part of the fun of having a little success in this business is that you meet the most amazing people who you can’t wait to work with in the future.

But the super angel community wasn’t as well developed when I was raising money in 2003 and that wasn’t an option for me.

So you need to realise why angels are investing — for fun, for adventure, for the ability to be close to the fire without getting burned, for the ability have an interesting story to tell at cocktail parties, backyard barbecues, and family get-togethers.

You need to realise that your investment opportunity is not a judicious choice with prospects for a reasonable return on a sensible investment.  Trying to make your start-up look like a good, safe place for your angels to put their money is ludicrous and counter-productive. If that was the case, they’d invest in Vanguard ETFs.

Seriously, trying to point out what a great investment your start-up is, is, well, stupid.  It’s not.  It’s  a horrible investment with a 90% chance of failing completely, a 9% chance of returning your investors’ money, and a 1% chance of returning 10x or more.  Those are just the facts, so you really shouldn’t fool yourself or fool others into thinking this is a slam-dunk smart investment.

No, what you need to realise is that smart, rich people set aside a tiny slice of their net worth to put into crazy ideas like yours, run by crazy people like you.  And you need to find rich people who have enough money in the bank such that $5,000 or $10,000 or $20,0000 isn’t make-or-break for their kid’s college tuition.  Otherwise, you’ll have to add guilt to all the other psychological challenges of being a start-up entrepreneur.

The reason your audience is thinking about investing in your angel round is that they want a piece of the American dream.  Being a stalwart member of the American upper middle class pays the bills, gets the kids through college and is a lush, luxurious existence compared to just about any other time or place.  It really rocks.

But it’s also boring.  Being a dentist or an audit partner or a corporate defence attorney is boring, boring, boring, compared to the high adventures you and your co-founders have embarked upon.  Let’s face it, you’re a living, breathing character out of mythology — you’re Jason and the Argonauts, you’re the Knights of the Roundtable, you’re the Old West and the Gold Rush and John Wayne all rolled into one.

Your day-to-day existence might feel like sheer terror and anxiety and fear of imminent corporate death, but that is exactly why what you are doing is so exciting to people stuck in Dilbertville with their red Swingline staplers… it’s feels like being alive!

So you need to find an audience of people who you can’t excite with your passion, and then you need to…

Tell them the story.

Now in order for a story to be captivating, it needs to have the truth about it.  Nobody wants to read a story or see a movie about cowboys sailing the open seas, or the three musketeers digging for gold.  Similarly, you’re startup story has to make sense, has to be true in the sense that you have a real idea that can help real people in exchange for real money.  You need to have a product or service that is going to change the world, because no amount of story-telling can cover up a bad idea.

But presuming you have a great idea and great passion about it, the best way to tell your story is to tell it as it happens to you.

Here’s how I told mine: I sent a weekly email to my audience of potential angel investors – -people I’d met at HotJobs, folks I knew from my brief stint in investing, friends I’d met in the internet business, anybody, really, who I thought could turn into a supporter, or who might know people who could be supporters.

Here are four examples of my weekly emails to investors.

You need to share your ongoing progress….



… really celebrate your wins….



…let ’em now that you’re asking for dough soon….



…and have some dorky fun sharing your adventures, your successes, and your customers’ thoughts….



…and you need to be brief and exciting (six bullet points is the max!) to catch your audience’s attention during their busy day.

And if I was doing this today, I’d be sure to include lots and lots of photos.

And then you need to close your angel round.

Nobody anywhere, ever, will write you an angel round check until the last possible moment when they absolutely have to sign on the dotted line or miss out forever.  Really.  They’ll indicate and promise and soft-circle and commit and intend, but until it comes down to the cold stark reality that if they don’t sign the check right now, their chance to be a part of the adventure disappears and they won’t have any high stories of adventure to share around the backyard barbecue… until it comes to that moment where not signing is more painful than signing, they absolutely will not actually write you the check.

At the beginning of January, we picked an arbitrary date – February 23, 2004 –  and told everybody that come heck or high water, that was the date that all the other angels were committing and the door was really, really closing on that date.  It’s the only way to be fair to everybody and to actually get something done.

So with an audience, our story, and a firm close date, we raised more than we’d intended to and closed our angel round of $635,000 the next day on February 24th, 2004.

I hope what worked for me works just as well for you!  Now get back to succeeding!

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