Signal-Based Prospecting

Most outbound outreach assumes prospects are always in the market. You send your email, and if the messaging is good enough, they'll reply. This assumption is wrong roughly 97% of the time.

The reality: at any given moment, only 3-5% of your addressable market is actively evaluating solutions like yours. The other 95% might be a great fit, but the timing is wrong — they just signed a contract, they're mid-migration, they don't have budget until Q3.

Signal-based prospecting flips the model. Instead of messaging everyone and hoping 3% are in-market, you identify the signals that indicate someone just entered the market — and you reach them in the window when they're actively looking.

This is Layer 4 of the Outreach Waterfall, and it's the bridge between warm relationship-based outreach and cold email. You don't know the person, but you have a specific, timely reason to reach out.

Not all signals are created equal. They fall into three categories, each with different conversion potential and response urgency.

Funding signals indicate a company has new capital and will be making buying decisions. A Series A round means headcount growth, tool evaluation, and infrastructure investment. A Series B signals scaling challenges. These are high-intent signals with a 2-4 week relevance window — after that, budgets are allocated and decisions are made.

Hiring signals reveal where a company is investing. A new VP of Engineering hire suggests tool reevaluation. A Head of Finance posting means process changes. Three SDR job listings indicate they're building outbound — and might need tools to support it. Hiring signals have a 4-8 week window.

Technology signals show what a company is building or changing. Adding Stripe means billing infrastructure work. Migrating from Heroku to AWS means scale challenges. Adopting Snowflake suggests data infrastructure investment. These signals are specific and technical, which makes them perfect for targeted, relevant outreach.

The good news: signals are public. You don't need expensive data providers or insider information. You need systematic monitoring of the right sources.

For funding signals: Crunchbase, PitchBook, and Twitter/X are the primary sources. VC firm blogs announce investments before press releases. Founder LinkedIn posts celebrating raises are real-time signals. Set up monitoring for your target industries and company stages.

For hiring signals: LinkedIn job postings are the most reliable source. Company career pages, job boards like Greenhouse and Lever (which expose their API), and "We're hiring!" social media posts all provide hiring intelligence. The specific role matters more than the volume — one VP of Finance hire is a stronger signal than ten engineering posts.

For technology signals: BuiltWith and Wappalyzer track tech stack changes. GitHub activity shows engineering direction. Conference talks and blog posts from engineering leaders reveal upcoming projects. Developer tool companies can also monitor package manager downloads and integration marketplace activity.

The challenge isn't finding signals — it's monitoring them consistently. Manual signal monitoring works for a day. Automated monitoring works for a year.

Signal-based outreach has a simple formula: [Signal] + [Relevance] + [Proof] + [Low-friction ask].

The signal is your opening — it's why you're reaching out now, not last month. "Saw your Series A announcement" or "Noticed you're hiring a VP of Finance" — this shows you're paying attention, not blasting a list.

The relevance connects the signal to your product's value. "When companies hit your stage, billing complexity usually increases 3x" or "New finance leaders typically reevaluate their AR process in the first 90 days." You're not guessing they have a problem — you're connecting their specific situation to a known pattern.

The proof removes risk. "We helped [similar company] reduce their collections cycle from 45 to 12 days after their Series A" or "Three other [their industry] companies at your stage use us for exactly this." Proof turns your claim from assertion into evidence.

The ask should be proportional to the relationship — which is zero. Don't ask for a 45-minute demo. Ask for 15 minutes, a quick call, or even just permission to send more information. The goal is to start a conversation, not close a deal.

When you're monitoring multiple signal sources across hundreds of target companies, you need a prioritization system. Not all signals deserve the same response urgency or effort.

Tier 1 signals demand same-day outreach. These are strong buying indicators with narrow windows: new funding rounds (first 2 weeks), executive hires in your buyer persona (first week), and explicit pain signals (social media posts about the problem you solve). Drop everything and reach out.

Tier 2 signals should be addressed within a week. These include hiring patterns (multiple related roles posted), tech stack changes that correlate with your use case, and industry events that create urgency (new regulations, competitor acquisitions). These are strong but less time-sensitive.

Tier 3 signals go into your nurture queue. Company growth milestones, conference attendance, content publication on relevant topics. These indicate potential fit but not immediate timing. Use them to add context to future outreach rather than as standalone triggers.

The discipline is in the triage. Most founders either treat every signal as Tier 1 (and burn out) or ignore signals entirely (and miss windows). Build the scoring system once, then follow it.

A signal-based prospecting engine has three components: collection, scoring, and action.

Collection means setting up automated monitoring across your signal sources. RSS feeds from Crunchbase, LinkedIn Sales Navigator alerts for job changes, BuiltWith notifications for tech stack changes. The goal is a daily feed of relevant signals that requires zero manual searching.

Scoring means applying your tier system automatically. Funding signals in your target stage → Tier 1. Hiring signals for your buyer persona → Tier 1. Related but not direct hiring → Tier 2. Everything else → Tier 3. This can start as a simple spreadsheet rule and evolve into automated scoring.

Action means writing and sending outreach within the signal's relevance window. Tier 1 signals get personalized messages the same day. Tier 2 gets batched weekly. Tier 3 informs your cold outreach personalization in Layer 5.

The entire engine can run on spreadsheets and manual effort for the first month. But the real leverage comes from automation — an AI agent that monitors signals, scores them, drafts messages in your voice, and queues them for your approval. That's the difference between checking signals when you remember and catching every relevant signal in real time.

Signal-based prospecting isn't magic. It's the discipline of reaching out when the timing is right instead of when your calendar is empty. Combined with warm intro layers above it and cold outreach below it, it forms the most effective outbound motion available to founders today.