“How is your product different from the competition?”

Startup founders get this question all the time.

Startups must be differentiated. Most investors agree. That’s why we wrote a whole piece on differentiation for our founder audience, which we published in The Founder Playbook newsletter a few months ago.

But the differentiation mindset doesn’t stop with startup founders. This concept is critical for investors, too. See, new micro-funds are popping up every day, it seems. Same goes for new angel investing syndicates.

It’s not that the people running these programs aren’t wonderful, or brilliant, or capable. But – much like investing in startups – investors need to know what makes your fund or syndicate different.

You might be wonderful, brilliant, and capable, but so are a lot of people.

Why should anyone invest in your thing rather than one of the five thousand other investment opportunities out there?

Last week, during an AMA with Elizabeth Yin, Charles Hudson explained how he explained his differentiator to prospective LPs when he launched Precursor Ventures, a pre-seed venture fund.

When Charles first approached LPs for his fund, he thought he had everything he needed to be successful:

• extensive VC experience
• a good idea

But for a long time he could not raise any LP money. After a particularly bad pitch, he sat down to re-think the framing of the fund. And he cracked it.

Charles is an incredible speaker and I probably can’t do him justice (although I have tried). Instead, head over to the recording of his chat with Elizabeth and fast forward to minute 12:50 to hear his story.

It’s so good.

Oh, and if you’re thinking of raising a fund and you want to:

• get more LPs
• learn tactics fundraise specifically for VCs
• pitch to a few hundred investors

Then you should come to Camp Hustle 2023. Discount codes expire this Friday, April 7 at 8pm PT. Use “SMALLBETS” to get after it.