Who are the Volition analysts? Why are they contacting me?
By MK Marino, Associate at Volition Capital
If you’re reading this article, you’re probably already familiar with VC and growth equity analysts and their “pitches” (which might start to sound the same, even if there’s an occasional creative angle).
Successful entrepreneurs receive many pitch calls and emails. I spoke with one founder recently who said he had received four emails from analysts just that day. So, it’s not surprising that some busy entrepreneurs would rather not speak to analysts like me (we don’t take it personally).
Still, just in case you’re considering whether to respond to Volition’s voicemails and emails, I’d like to give you a behind-the-scenes view of what analysts do at the firm and why we may be powerful assets to you – and thus worth a conversation.
#1 Researching your company
Before even picking up the phone or composing an email to you, we spend a lot of time searching through databases, articles and growth signals to see if you’re making waves. After that, we continue to dig in to find answers to such questions as: Have you launched any new products recently? Or What do your customers say about you?
#2 Reaching out to you
This part is tricky. Based on our research, we craft an email to you or call you. As you already know, there’s a lot of noise in the market from analysts (and every other salesperson out there) trying to get your attention. We do our best to communicate why we are interested in your business – and we put in some old-fashioned elbow grease to connect with you. As we optimize our approach we also try to stay human and genuine at every turn. Every week, I and the other analysts meet with our firm’s VPs and Principals to review the companies we’re interested in, but cannot reach. Then, more often than not, we keep trying to make contact.
#3 Conversing with you
When we’re able to set up a meeting or call with you, it’s one of the best parts of our job. We genuinely enjoy learning about how you acquire customers, what your competitive advantage is, and what your future plans are. However, we’re careful not to waste your time. While we love to learn about any and all businesses, Volition’s investment focus is very narrow. We’re not a good fit for every business and every business is not a good fit for us. So, we often use our investment criteria as a baseline for our conversation with you.
#4 Holding post-call internal discussions
When we get off a call with a company that we’re really excited about, we’ll walk straight into a partner’s office and share what we’ve learned. If the company is a good mutual fit, we’ll email notes from the conversation to our entire investment team for review (this happens irrespective of whether the company is interested in raising capital). Every investment partner at our firm will read the notes of that call within 24 hours.
Around this time, some email dialogue regarding your company will take place. In addition, our call notes will be included in a discussion packet for our Monday team meeting. At that meeting we discuss every company that has been elevated in this way, and we decide the next steps relating to a potential relationship.
Why Analysts are an Asset to Entrepreneurs
The next time you find yourself rolling your eyes as yet another email from an analyst lands in your inbox, think about the potential benefits that can flow from making a connection:
We are your direct line to the partners (and they pay attention)
Partners don’t have time to look at every opportunity. Therefore, it’s our job as analysts to elevate the opportunities that we believe are most interesting and relevant. Essentially, if we’re not excited about an opportunity (or cannot get in touch), we won’t elevate it.
According to Volition Capital Managing Partner, Larry Cheng, “I absolutely pay attention when an analyst is excited and has conviction around a company. I trust the judgment of the analysts at our firm. So, my advice to companies is if you want to have the conversation with the analyst – treat the analyst like you’re talking to a Partner because the salient points of what you communicate will not just get to one partner, but all of the partners of our firm”
We know how to pitch an opportunity to the Partners
We know what kind of opportunity the firm gets excited about and we know which Partner will probably like the opportunity the most. The more we know about your company, the more we can position the opportunity so that a Partner will want to follow-up.
We advocate for opportunities we think are great
There’s been more than once that an Analyst has persuaded a Partner, VP, or Principal to look at a company regardless of their initial impression because we liked it or had a fantastic conversation. At Volition, 25 of our 25 investments were sourced by an analyst’s cold email or cold call. Those investments have enabled a whole world of entrepreneurs, their teams and their customers to flourish – and that’s the end goal of our work.
Advice on Handling Calls and Emails with Analysts
If you’re wondering how to approach a call with an analyst (or whether to speak to an analyst at all), here’s my best advice:
A powerful way to start (or end) the conversation is to ask the analyst what specifications the firm is looking for and to be forthright about where you fit. If an analyst is unable to clearly answer what they are looking for, the call may not be worth your time.
You deserve transparency. For example, if you asked a Volition associate about our investment focus, he or she would share these criteria (companies that we discuss with the entire firm typically fit most, if not all, of these):
- Sectors: Consumer, internet, software / SaaS, tech-enabled services, information services
- Revenue: Typically, $5M to $50M+ revenue
- Revenue growth: 25%+ minimum, typically 50% to 100%+
- Financing history: Limited or no prior capital raised
- Profitability: Near break-even or profitable
- Most important: Aspirations for greatness
At the end of the day, analysts like me exist to help discover incredible entrepreneurs and teams who have poured everything – countless hours, worries, and dreams – into building a business. Every day, we look to start meaningful conversations, to understand their businesses and aspirations. Ultimately, we’re here to advocate for them and give them visibility within our firm – so we have the chance to do great things together.