How can I pitch successfully to an investor?
When seeking investment, you need to stand out from the crowd. Here are some tips for delivering the perfect pitch
A friend with several investor contacts has lined up a few meetings for me but I’m really nervous about pitching. I think I have a fairly solid business plan but I don’t want the pitch to just be me reading off financial forecasts. What can I do to prepare myself and stand out?
Julian Ranger writes:
Private investors, or ‘business angels’ as they are often called, are interested in financials, but also a lot more in addition. I have sat through many pitches and far too many are unbalanced – just a little on the idea but everything on the financials, or alternatively everything about the idea and nothing about the financials – both of these approaches fail.
For me, the three main elements of any business, which all need to come across in any presentation, are:
- the management team
- the idea or business proposition
- the revenue plan and financials
It is essential to generate a spark in your audience initially – so wow them with your idea or business proposition. For example outline what you do, why it is so great, what the competition is, why you are better, the intellectual property or other barriers to entry.
Now I, as a potential investor, am enthused by your product, your domain knowledge, your vision, so tell me some more about yourself – your past successes, things you have learned and why you are a great team leader. Notice the word ‘team’ – who else is in your team, what makes them special, how can you collectively handle the hurdles and setbacks which will arise, have you done it before?
Then to the market – how are you going to sell your product or increase sales or add to your product/service offering? How are you going to become dominant in your marketplace? On what basis are we to believe in your sales forecasts?
So now I believe you have a great product, a great team and great sales prospects, I want to know about your financials. Tell me the state of play today, projections for the next three to five years and finally, tell me what you need from me as your investor, why and what’s in it for me. Too many presentations fail to make clear that punchline i.e. “I am looking for an investment of £200K for 30% of the business and our exit will be by this route in three to five years”.
So that’s the outline of a possible presentation – have a look on the web as there are many templates and examples which will give you more detail. When it comes to creating your presentation, practice it with your team, as well as with business friends, until you get it to 10-15 minutes, are sure it is balanced in content and you are confident in your delivery. At this point you are ready to go live to real investors.
And one last thing – you have to kiss a lot of frogs! Don’t get knocked back just because someone says no; ask why and if necessary refine your pitch for the next set of investors.
Have confidence in your idea and plan, because if you don’t, no one will.
Julian Ranger has been an angel investor since 2007 and now heads up an innovation hub called iBundle where he invites start-up entrepreneurs who are looking for backing and advice to contact him