Pitching to investors is one of the trickiest things to do when you try to raise funds for your business. The idea of talking about your passion in front of people who may not be as enthused as you are, is a challenge in itself. Even with well-planned presentations and numerous rehearsals, a pitch can go completely awry. It is therefore of prime importance to hold a few things in mind as you begin your proposal for fundraise.
- Starting with a Story
Your primary motive at the start of a pitch should be to engage the investor. The first 30 seconds are vital in capturing the attention. A good way to get investors involved in your pitch is to start with a story. Your story should address the problem you’re trying to solve in the market and at the same time explain how your company stands to benefit from it. You’ll have to frame it in a way that it strikes a chord with the investor.
- Less Works More
A verbal presentation with lengthy explanations is a complete turn off for any investor. Keep in mind to frame your points short and precise. Your presentation should only give hints as you take center stage to explain things in detail. Make sure investors understand your concept in a short span of time, otherwise there can be a presumption that customers won’t understand it either.
- Sharing Your Journey
Integrity is an important trait that investors look for in an entrepreneur. Give a detailed explanation of the success journey of you and your team. Earn some brownie points for the relevant traction (sales, product launches, awards etc.,) you’ve had. This is the time to blow your horn.
- Understanding of Target Market
Investors are looking for you to explain to them the target market for your product/service. A complete understanding of how your company can tap the market’s potential will play a vital role in you securing the funds. Analyze all aspects of your industry and bring valuable insights to the table.
- Knowing the Competition
Every new company that pops up has a competitor in the market. Saying that your business has ‘no competition’ will leave an impression that you’re either ignorant or in denial. Know your competition and explain how you have an edge over them.
- Your Revenue Model
It’s not only about providing solution to a problem; investors want to know how you can make revenue out of it. Be sure to break down your pricing and explain the investors how your market is ready to pay for your product/service.
- Financial Projections
Have a detailed projection of your company’s revenues for at least three to five years. It is very important to have two cases wherein one is the normal scenario and the other is the worst-case scenario. Investors are looking for realistic growth figures and will appreciate your prudent calculations stepping into future.
- Funding Needs
When pitching to investors, be sure about the amount of money you need to scale up your business to the next level. Explain why you need the money, what it will be used for and how it will be used to achieve the desired outcome.
- Your Exit Strategy
Investors are looking forward to hearing the plans for your company 5 or 10 years down the line. Whether you’re planning to get acquired, go public or do something else, be sure to enlighten investors as to why that is the right choice.
- Future Potential
Investors would ideally be pushed to invest in your idea if you can hint on the possibility of more future opportunities to come, other than those mentioned in your pitch. This serves as an eye-opener that gets people to think of newer and more ambitious avenues.
Always remember to end your fundraise proposal with a “Thank You” note. Appreciate the time investors gave to listen to you and highlight the fact that you are looking forward to growing with them.
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