How to Treat Warm Intros

Everyone loves a warm intro. It feels like progress.

You get the calendar invite, drop the name of whoever made the connection, and convince yourself you’re halfway to a term sheet.

But most warm intros don’t fail because the investor wasn’t serious - they fail because the founder got lazy.

Warm intros create a false sense of momentum. They make you think trust is already built when you’ve just borrowed someone else’s credibility for five minutes.

The investor still needs to see conviction, control, and competence - and they’re looking for how you handle the meeting once the social grease wears off.

Here is (in our opinion) how to structure a warm intro call with an investor when you’re looking to raise capital:

Reframe the Conversation Quickly

As humans, when we encounter new people we love to find common ground to stand on. Places we’re from, people we know, things we like, etc.

In these kinds of calls, this is okay to do at first, but make sure you quickly get off of it.

“Appreciate the convo today {name} - why don’t I share some quick background about us and where we’re going, and then you can dive into a little more about you and your group.”

Don’t spend too much time on the similarities between you two and waste half the call.

Get a Solidified Next Step in Progress

The worst possible thing you can do after having a good call with an investor is get stuck in “maybe” purgatory and have unclear next steps on the process.

You should end your meeting with direct action items from both sides on exactly what is going to happen next, the timeline for these actions, and who is responsible for them.

If the investor doesn’t want to commit to that, they were never really interested in the first place.

Get Opened Up to Their Network

It would be unrealistic to think that every conversation you have with a “warm” intro would automatically be a great fit.

But that doesn’t mean you can’t ask the investor if anyone that they know would have more interest in your company.

A lot of buy-side groups are very closely knit. If someone they know has a closer thesis to what you’re currently building, there is no reason to not ask them for an intro to that person. Be resourceful. Try and get as close to the “source” as you possibly can when it comes to aligning your company with the closest investor thesis.

For the record, I still don’t believe that only having warm intros to try and raise your round is the right approach for a lot of you looking for funding.

It is only 50% of the approach we take for our clients that we run through our Capital Advisory program.

But from the conversations I am having every day with so many of you, I think there are specific ways you can get the most out of every warm intro call you have with these groups, to maximize your chances of getting the right person to invest in your company.

I hope this was helpful. As always, happy to answer any questions I can for you.

Have a great day,

Ryan Bryden
Breakout Capital Group