Although many budding entrepreneurs have brilliant ideas, a majority of them don’t succeed due to a lack of adequate funding. There is a huge gap between coming up with a unique business idea and turning it into a successful business. If you really want to get funding for your start-up, you need to craft an irresistible pitch that turns heads. Here are great tips to help you design a compelling pitch.
Don’t waste a lot of time explaining trivialities about your business idea. Instead, tweak your pitch to ensure it’s as brief and precise as it can possibly be. With over 30 years of experience investing in sectors such as technology and agribusiness, Mark Stevens and other established investors only have time to listen to short, yet convincing pitches. If your potential investor has given you 10 minutes to present your pitch, take seven.
For instance, it’s very irritating to keep saying “one last thing” and keep going on and on about how your idea is exceptional. Regardless of how persuasive a particular section is or excites you, especially when presenting with slides, don’t dwell on it for over three minutes.
Spending a few minutes to present your pitch will give potential investors enough time to ask questions and interact with the idea, which may build more interest. If you show investors that you value their precious time, it’ll convey your respect for them. You need to demonstrate your ability to treat an investor’s money with respect by keeping time.
Choose the Right Investors
Not every investor will be interested in your start-up idea. Successful investors are very particular when selecting the niches and levels of start-ups they want to invest in. Therefore, you need to choose your potential investors wisely.
Pitching to just any investor would be a waste of your valuable time and that of the investors. An angel investor with an extensive portfolio of investments in your particular industry would be a good start. Once you have identified the right audience, it becomes easier to design a customized pitch.
Tell a Story
Historically, the art of storytelling has proven to be an effective way of capturing an audience’s attention. So, instead of boring potential investors with complex valuations and spreadsheets, try and make your pitch unforgettable with an intriguing storyline.
Interestingly, many of these experienced investors are so tired of listening to long term sheets and prefer to hear the story and pathos behind unique start-ups. Even if the investors you are facing are data-driven individuals, your storyline could help grab their attention before you begin explaining the hard data.
Explain All the Details Clearly
Make sure all the details are clear to the investors by allowing them to interact with the actual product or service. Remember, investors care more about their hard-earned money than your “perfect” idea. So, it’s upon you to utilize every second of your time in explaining the facts clearly. The sooner you get to the profits and growth potential sections of your pitch, the higher the offers you’ll get.
If you feel your pitch doesn’t offer anything unique, keep working on it, rather than rushing into investor meetings unprepared. Use psychographic features and viable demographics to pinpoint your target market. Investors will want to see relevant data points when analyzing your potential customers.
Show an indisputable level of confidence during the presentation. No one will give you funding if you appear unsure about yourself. Do some role-plays with your team members or close friends and let them ask you the hard questions. It’s the part of the business that you’ve not figured out or discussed with anyone that could ruin your pitch.
Apart from being laser-focused about sales revenue, think outside the box so that you become courageous and ready for anything. Your pitch is your opportunity to convince investors that your business is bound to flourish if the potential is unlocked. You can only achieve that if you present your idea confidently and effectively.
The way you present your pitch should leave no doubt that your investors’ funding will shake the industry by doing things differently. Demonstrate that potential by clearly explaining how your investors’ funds will be strategically deployed.
Show an Exit Strategy
Many entrepreneurs overlook this crucial aspect of their start-ups. Don’t be sold on your business idea to the extent that you don’t conceive the fact that you may need an exit strategy. For example, give these investors a five-year benchmark within which they will have made a lot of money.
Smart investors want you to give them a well-planned timeframe to expect to make substantial profits. Your exit strategy should be in the form of a licensing, IPO, or acquisition. In other words, instead of dwelling on marginal returns from the start-up, focus on valuations that promise potential investors big payoffs.
Your pitch will either set your business idea off the ground or derail it. Statistics show that 13 percent of founders fail due to a lack of sufficient funding. Getting funding from established investors is one of the fastest ways of implementing a brilliant business idea. The primary goal of your pitch should be to have investors begging to be part of your team. While that may sound too good to be true, it’s feasible if done right.