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Pitching to investors
Presenting a business idea for cash means maximising your pitching power
Many companies fail to raise finance simply because their business pitches aren't up to scratch. When you look at the numbers, of a 100 companies that present, one will be invested in by a Venture Capitalist (VC), and that's after going through the process of preparing a business plan, so your presentation has to be perfect planned and orchestrated on the day. The good news is, they will give you immediate feedback, good and bad, just look at Dragons Den if you want to see how honest, and the truth may just hurt. So what can we do to prepare for the big day? here are some tips on pitching to investors
1. Take an audience centric perspective - pick the investor that is suitable to the type of VC or Angel to your business. Make initial enquiries by phone and look at the sort of companies that they have already invested in. Its pointless pitching to a VC interested in renewables if your business sells candy floss.
2. Time is money, literally - investors are shrewd business people short of time, get to the hub of your proposition quickly, learn the art of the elevator pitch, remember gain their interest early in order to motivate them to listen more.
3. Take their perspective - investors want a good return, and they want to invest in a strong management team. Think how you are going to support your plan with the necessary people to make your idea happen and turn it into a profitable proposition.
4. Remember the laws of recency and primacy, the first thing that is said or seen and the last will stick in their minds, so make sure you've thought of the likely questions that you are likely to encounter.
5. Image is everything, they are looking to invest in you, and your idea. Dress accordingly, you need to come across as a professional that will invest their money wisely, invest in a new suit and get a haircut. They are investing in you just as much as your product.
6. If your product allows it, give it to them to create some experience around the investment as part of your pitch. If you are bringing screenshots, make sure they are big enough for the investors to see.
7. Be driven by data, if you've sold it tell them to whom and how much, mitigate their risk as much as possible with good news.
8. Be honest, lying or deceiving will not fare well during the investigation process.
9. Keep your language simple and clear - avoid acronyms, jargon or wild promises, be honest and credible with your numbers.
10. Be enthusiastic and passionate, if you can't get excited about your idea, they certainly won't.
11. Have a walk away figure planned out, they will negotiate on equity, so work out how far you are prepared to go.
12. If at first you don't succeed - don't give up, many great products and services have been rejected along the way, just because this lot don't say yes doesn't mean the next set of investors will say no - believe in your idea, and act of the feedback given.