Thread by @dunkhippo33

Since a lot of people were asking for more details, today I want to do a quick case-study on Modus and how we invest cold generally speaking (or "direct" as someone suggested I use instead)

Read on >>

https://twitter.com/dunkhippo33/status/1314660193905504256

1) First off - let's establish baseline. 15% of the deals we do are direct.

So, if we invested in your co & someone (ANYONE - your friend / a VC / an acc / your dog) referred you, you are marked as a referral even though we often don't even know our referrers well / if at all..

2) 1 of these 15% was Modus who closed a very successful exit last week.

Let's walk through the timeline and the interactions.

3) First, they applied on our website hustlefund.vc - yes, we do read ALL of these. (tho depending on time of the yr, we can be slow :( ) But this is where ALL pitches go whether referred or not.

4) They also cold emailed in parallel. This is what they sent Apr 2018 - we'll dissect this in a min:

5) As you can see, they are SUPER EARLY. That doesn't scare us.

That being said, even if you are early, there are always interesting tidbits that you can highlight.

6) This email has:

a) social proof another VC wanted to invest
b) potential customers they were onboarding & LOIs for more

LOIs don't mean much to me, but we don't care about traction @HustleFundVC so it was a bonus. All in all, I thought it was a clear, concise email.

7) I looked at the idea and the go-to-market. Most investors care a lot about team. I care about whether I think the go-to-market will be easy or hard.

More on that here:

8) In the biz they are in, homebuyers don't pick their title & escrow co when buying a house - real estate agents do. So if they did a good job being valuable to real estate agents, the go-to-market could be great.

9) I took the phone call on May 2 about 10 days later. Typically it takes me 1-2 weeks to get a mtg depending on how many other mtgs are already lined up.

10) I made the offer on 5/4 - 2 days after the mtg. We have a champion model @HustleFundVC so we don't need to have an all partner mtg about writing a first check which allows us to usually deliver a decision within 48 hours after the first mtg.

11) tl;dr there isn't a whole lot to dig into at pre-seed (as you could see from the initial email), so that's how we are able to make decisions so quickly.