My phone buzzes as I get a text from a friend who’s a partner at a VC firm. It’s a screenshot of a Venmo notification that just came in. “My 2 cents on why you should invest in my company,” reads the message she received, along with a $0.02 transfer. I tracked down and emailed the founder who sent the transfer to figure out what they were up to.
“In the past two and a half weeks I’ve reached out to over a hundred VCs, angels, celebrities, athletes and influencers through Venmo,” says Chip Herndon, CEO and co-founder at Chatterbox, in an interview with TechCrunch. He claims that his unorthodox marketing campaign has been very successful. “I’ve received multiple responses, two of them being extraordinarily high quality. The first was a partner at [a venture firm], the other was an angel investor.”
Herndon claims that messages those were the beginning of a string of meetings that may well result in an investment.
Chatterbox is a platform that describes itself as a Nextdoor for Gen Z. It connects young people in their local communities through a medium they understand — group chats.
“In our early stage we’re targeting college campuses. We have three core features: user-generated chats, emergency chats and permanent chats. For example, we’ll launch at UCLA in partnership with the USAC President this October,” claims Herndon. “As part of the MVP we’ll have permanent chats for every dorm building, library and other high-user-density locations; we’ll also allow users to generate chats for interesting events they encounter, and lastly we’ll automatically generate chats for emergency situations.”
The founder says that the Venmo-fueled outreach campaign stems from a desire to be noticed in an intensely competitive landscape.
“I had to get scrappy. I set aside four hours with only a pen and a piece of paper in front of me, not allowing myself to do anything other than brainstorm until I had a strategy,” says Herndon. “In that time, I thought of multiple untraditional avenues to contact someone, but in the end I decided that Venmo would be the best.”
Leveraging the Venmo platform’s search and profile pictures features, he set out to find the investors he was looking for, and he claims this enables him to “gain their attention in a way that doesn’t feel intrusive.”
Not all investors agree on that particular point. “It feels a little creepy,” noted one investor who received one of the Venmo transfers.
That may not be the case for everyone, though.
“You’ve got to do what you can to stand out,” said an associate at another venture fund I spoke with for this story, and for a moment seemed impressed by the creativity. “Would I love to receive a ton of $0.02 donations with a bunch of random pitches for startups? No, but the first one or two might stand out enough that I’d pay attention.”
Kudos for trying something new, I suppose, but be aware that gimmicks often backfire.
So, is this the next big way to reach out to investors? Personally, I think it comes across as pretty spammy. Let’s put it this way: The first PR person that tries to pitch a story to me via Venmo will get themselves banned and blacklisted; my email address is easy to find, and in my opinion, it feels really skeevy to try to go around the channels that are in place to get yourself to the front of the list. But then, I’m a little OldManYellsAtCloud.gif about these things; your mileage may vary. Just be aware of the first impression you’re making; it may not be as positive as you think.