How to Pitch an Idea to Investors With Total Confidence
- Nail your elevator speech.
- Research your audience.
- Use realistic data (and be able to back it up)
- Tell an engaging story.
- Have a documented succession plan.
- Dress for success.
- Know your revenue model.
How do you pitch an idea with confidence?
You Probably Need More Friends—Here’s How To Make Them
- Live Your Story.
- Practice Until Your Pitch Becomes Second Nature.
- Show Up Authentically And Confidently.
- Stop Trying To ‘Pitch’ And Focus On Communicating.
- Don’t Think That This Pitch Will Make Or Break You.
- Remind Yourself Of What You Care About And Why.
How do you pitch to impact investors?
3 Keys to Successfully Pitch an Impact Investor
- Tell Your Story. Just as it’s critical in your donation appeals, storytelling is one of the most important parts of pitching investors.
- Do Your Homework.
- Show What Makes You Different.
How do you convince an investor to invest in your idea?
11 Foolproof Ways to Attract Investors
- Try the “soft sell” via networking.
- Show results first.
- Ask for advice.
- Have co-founders.
- Pitch a return on investment.
- Find an investor that is also a partner, not just a check.
- Join a startup accelerator.
- Follow through.
What do investors look for in a pitch?
The pitch deck should include details of who the people behind your business are, the problem you are trying to solve, your product or service which acts as the solution to that problem, traction, the current market and your competitors, as well as details of your business model and how any successful investment will
What is your investment strategy?
An investment strategy is a plan designed to help individual investors achieve their financial and investment goals. Your investment strategy depends on your personal circumstances, including your age, capital, risk tolerance, and goals.
What is a PE investment thesis?
Define an Investment Thesis. The first thing PE firms do when they acquire a business is define what we call an investment thesis— a clear statement of how they will make the business more valuable within about three to five years. The thesis is then used to guide every action the company takes.
What are the investment criteria?
Investment criteria are the defined set of parameters used by financial and strategic buyers to assess an acquisition target.
What do most investors want in return?
Most investors take a percentage of ownership in your company in exchange for providing capital. Angel investors typically want from 20 to 25 percent return on the money they invest in your company.
How do you convince a funder?
How to Convince People to Invest In Your Startup
- Do the thing you say you’re going to do.
- Start small — trivially small — and then build up.
- Make three people love you.
- Ask for advice, not money.
- Be authentic.
- Consider an equity crowdfunding campaign when the time is right.
- Leverage the ‘social proof’ from crowdfunding.
How do you connect with investors?
10 Things You Must Do Before Connecting With Investors
- Do your homework.
- Follow a strategic planning process.
- Develop a business plan and financial model.
- Draft a set of key milestones.
- Create a story that encapsulates the problem your company solves.
- Create an investor presentation and pitch deck.
11 Steps to Pitch an Idea to Investors With Confidence and Get Funded
I’ve been in the position of making a pitch to investors, both angels and venture capitalists. Previously, for my technological businesses, I was able to secure close to $1 million in funding from angel investors. It is possible that you may just have 10 minutes to pitch your company prospect to the potential investors (or less in some cases). Here’s how to put together a winning proposal that will enhance your chances of acquiring financing.
Tips for nailing your elevator pitch
When putting up your elevator pitch, you’ll want to think about what will serve as a supporting element to your speech. Here are a few pointers to help you make the most of your elevator pitch.
Create a pitch deck
To begin, set aside some time to put up a pitch deck. Your company’s visual depiction of itself, which you might use while interacting with investors, is known as a pitch deck. In many ways, it should be the same information that occurs in a Lean Business Plan, but it should be more concise. You can add appendix sections with more financial and business plan information as your project progresses. Keep things basic and easy to remember so that you can refer to them while talking about your company.
Check out our freepitch deck template for Powerpoint as well as over 50 samples of Startup Pitch Decks to get some ideas for your own presentation.
Practice, practice, practice
When it comes to practicing your pitch, there’s one thing I can’t emphasize enough: practice makes perfect. “Oh, I know my business inside and out – pitching will be a piece of cake!” I’ve seen far too many entrepreneurs believe this. Wishing you the best of luck! I’ve witnessed a number of entrepreneurs fail miserably while presenting their investor pitch—and ramble on for an inordinate amount of time. There’s nothing more aggravating than being told, “I just need 10 minutes of your time,” and then realizing that you’re still on slide number five 20 minutes after you were told that.
Additionally, it may assist you with tightening up specific portions, identifying any spots that require extra context, and just increasing your confidence in your pitching.
Bring supporting documentation
Furthermore, investors will expect you to be able to provide evidence to support your assertions. Be prepared to present your business plan with investors so that they can learn more about your company. Have financial accounts and sales predictions that are clear and precise and that demonstrate viability. After all, the goal is for you to present a compelling pitch, and at the conclusion of it, their hands will be out, demanding either your executive summary or your comprehensive business plan.
What investors look for in a pitch?
So, what exactly do you need to address throughout your presentation in order to pique the interest of potential investors.
The following is a template that I’ve used effectively for my personal companies as well as to assist many other first-time startup CEOs in raising investment funds. Here are the 11 most important principles to remember in order to communicate successfully.
1. Craft a story around the problem
Start your pitch with an engaging tale that will keep the audience’s attention. It should be tailored to the problem you’re attempting to solve in the marketplace. This will immediately pique the interest of your target audience. The more your ability to link your tale to your audience, the more effective your presentation will be. Do some background research on the investor so that you can get a clear understanding of what they are interested in and personalize your tale to suit them.
2. Your solution
Explain what makes your product stand out from the competition and how it will address the problem you discussed in the previous slide. Keep it brief, succinct, and easy to understand so that the investor can convey it to others. If your investors are not well-versed in your business, avoid utilizing keywords to attract their attention.
3. Know your audience
Even though it is possible that everyone on the planet is a potential target market one day, don’t claim that everyone on the planet is a potential target market today. Remember who you’re designing your product for, and segment your market into TAM, SAM, and SOM segments to make it more manageable. Not only will this wow your audience, but it will also assist you in thinking more strategically about your roll-out strategy.
4. Explain the viability of your business model with distinct sources of revenue
This decline is the one that investors are most concerned about. What method will you use to generate money? Make a point of being very clear about your items and prices, and underline how eagerly your target market is expecting your arrival. According to the nature of your company, this might be a very basic process or somewhat more complicated. One of the most crucial things is that you are able to explain how your company model operates and that you can relate income and costs. Keep the definition of the figures on this slide for your financials part; keep it for your financials section, and make sure you have the supporting documentation ready to go.
5. Shout out your success — early traction and milestones
You want to establish credibility as soon as possible in the presentation. Please take the time to provide the pertinent traction that you’ve received. Evidence of your company’s traction, such as primary consumer research, pre-sales data, or other kinds of prospective income, should be provided. If you and your team have achieved success to this point, wow the investors with that accomplishment — but don’t stop there. You must demonstrate that you can expand on your first traction and that you have established product, revenue, and growth milestones for your company.
6. Explain how you’ll acquire customers
When it comes to investor pitches and entire company plans, one of the most frequently overlooked aspects is your marketing and sales strategy. However, you must demonstrate that you have researched and understand your potential market, as well as how to offer to your target clients. It is critical for investors to understand how you intend to advertise your business, sell your products or services, and what it will cost to attract new consumers before they make an investment. What methods will you use to contact your customers?
How much will it set you back?
If you have any messaging samples or specific channels in mind, please include them in this section as well. In addition, if at all possible, attempt to tie your acquisition expenses back to your overall income in order to demonstrate how your marketing expenditures will grow or reduce over time.
7. Showcase your team
Investors prioritize individuals above ideas when making investments. Consequently, make sure to provide specifics on your rock star staff and why they are the best people to head this organization. Also, make sure to include any skill sets that you believe are lacking on your squad. The majority of startup teams are lacking crucial personnel, whether it’s in marketing, managerial knowledge, programmers, sales, operations, financial management, or any other area. Inform them that you are well aware that you do not know everything!
8. Use realistic financial projections
Demonstrate how much money you expect to generate over the next three to five years. You must provide evidence to support your statistics by describing your assumptions. You’ll notice investors pulling out their smartphones and using them to check your numbers to make sure they make sense. As a result, provide them with the information they require to verify that your estimates are correct. Make sure that you have predictions for your profit and loss, as well as your cash flow statements, in addition to sales forecasts.
9. Know your competition
Many individuals skip over this area or don’t go into enough depth on how they are different from their rivals in order to stand out. Nonetheless, it is critical that you demonstrate that you have conducted thorough research as well as the ability to quickly identify and explain your competitive advantage when compared to direct and indirect competitors. The most effective way to communicate your value proposition in comparison to your competitors’ is to present this slide in a competitive matrix format — where you list your competitors down the left side of the page, your features/benefits across the top, and checkmarks in the boxes next to the companies that provide each service.
10. Explain how you will use any funding
Clearly state how much money has already been invested in your firm, by whom, and what percentage of ownership you have, as well as how much more money you will need to raise to take your company to the next level (and be clear about what level that is). Will you be required to raise further funding in various rounds? Specifically, what type of investment do you want to make: a convertible note, an equity round, or something else? Remind the audience of the reasons why your management team is capable of managing their investment for long-term success.
11. Define your exit strategy
If you’re looking for substantial quantities of investment cash (above $1 million), most investors will want to know what your exit strategy is before they would invest in your company. Are you considering being purchased, going public (which is something that only a small number of firms really do), or something else?
Make it clear that you’ve done some research into your exit plan, including researching the organizations you’re targeting, and that you understand why it might make sense three, five, or ten years down the line.
Prepare to pitch
The better prepared you are for your pitch, the more probable it is that you will be successful. Furthermore, by having a completely fleshed-out pitch, you’ll be even better prepared to speak about your company while networking, communicating via email, or speaking at any other chance that comes. Wishing you the best of success with your business pitch! Oh, and I nearly forgot to include one more extremely crucial component of pitching your business: have fun! Have fun with your business pitching!
An entrepreneur is someone who makes a profit. A disruptor is someone who causes trouble. An advocate is someone who fights for you. Caroline has served as the CEO and co-founder of two technology companies, one of which failed and the other of which she sold. Other entrepreneurs may benefit from her passion for teaching them how to fulfill their full potential and learn how to move outside of their comfort zones in order to stimulate their growth. Caroline is the executive director of Oregon RAIN at the moment.
Cummings, who also serves as the Rural Venture Catalyst Manager, is responsible for overseeing the implementation of RAIN’s Rural Venture Catalyst initiatives.
She also conducts educational seminars.
If you are considering how to pitch a concept to an investor, you should know that it is not a simple process. Startups have taken over the corporate world in recent years. For several years, we’ve heard a lot about unicorns, angel investors, venture capitalists, and accelerators. Seeing the expanding number of emerging enterprises that are employing investor money to accomplish quick development and have a worldwide impact is both unexpected and encouraging to observe. Startups are working out how to solve the difficulties that individuals and organizations are experiencing.
- But wait a minute, is it really so simple to solve a problem?
- The first stage is to make your company idea known to the right people.
- It is critical to be able to effectively pitch a startup concept.
- Let’s have a look at some instances of how to pitch a company concept in 5 minutes or less.
Mobile app that lets you talk to a Veterinarian about anything.
“My vision is developing a veterinary app that allows users to communicate directly with professionals about any concern.
“We will also link the client with a veterinarian in their local region.” Levi Loveless is a satirical writer who lives in New York City.
“Lifelogging: GoPro for everyday life.”
“A wearable device that looks like a pair of glasses that captures and retains everything from birthday celebrations to business meetings.” You can’t remember where you placed your keys? Just have a look at your Lifelog.” John Manzella is the author of this piece. A classic example like this piques the interest of investors who are eager to learn more. Continue to attract investors’ attention since attracting investors’ attention is so commonplace. The most effective approach to accomplish this is to propose your business concept and stimulate their curiosity.
- However, however, 80 percent of them fail to obtain sufficient business capital in the long term, and as a result, many ideas seldom materialize into viable enterprises.
- When pitching a company concept to an investor, the most important thing to remember is to answer the most critical questions that your audience is expecting to hear.
- Instead than chasing after investors, let investors to pursue you.
- Even large corporations are considering ways to expand their operations.
Break the idea into two: Problem and Solution
First and foremost, define the problem: Explain your concept and why you wish to address the problem; consider why it is critical that the problem be resolved. Provide a solution, such as: When it comes to investing, time equals money. Make an attempt to connect your answer to a real-world scenario while keeping it simple. Maintain order and simplicity in your solution. Any complexity may cause the panel to get perplexed, and you may lose their confidence in your approach as a result. Make an educated guess: Provide a projection that takes into account both the average and worst case possibilities.
Here are some founders who turned Business idea into Million Dollar Company with a Pitch:
Be upbeat and confident; when investors see how confident you are, they are more willing to invest in your company. The product or service is not the main focus; rather, it is you. So go ahead and do it! Here are some real-world instances of people who were successful in presenting their company ideas.
Rob Biederman, co-founder of HourlyNerd, has a funding story that surely is kind of movie story.
The website enables you to register and engage expert consultants with top-tier qualifications at a cheap cost and in the shortest period of time possible by registering on the site. Because it is such a well-conceived concept, the firm has been highlighted in publications such as the Wall Street Journal, The New York Times, Harvard Business Review, and a slew of others. They required finances to pay their website building company when they first launched the company. They considered driving the investor out of the league and instead immediately emailed an investor named Mark Cuban, asking him for finance assistance.
They earned $450,000 after only 15 minutes of work. With that in mind, have you considered taking a chance on something unknown? After all, what are you going to lose by trying it out?
How one woman used traditional methods to get funding to buy a company.
Using only traditional procedures is not enough. Intuit sold MyCorporation.com to Deborah Sweeney, who purchased it. It was feasible to acquire financial support for the purchase because of strong credit and a solid history of loan repayments, as well as by keeping a cordial connection with the bank. To be eligible for this type of loan, you must, of course, have a strong credit score in order to be approved for one. If your credit history isn’t quite up to par, there are websites such as Kickstarter and other crowd financing channels that you might consider.
It proved to be quite effective, as they were able to pay off all of their debts, and, guess what, they are now debt-free and experiencing successful development and profit for the firm as a result of it.
What makes investors proceed for investment:
As you have previously verified your business concept and anticipated its potential development, this section will be brief. You will now be releasing your concept into the public, ensuring that it is worthwhile of your time and work, as well as meeting your investment target. Let us take a look at some of the milestones from the perspective of an investor.
What is unique?
Make certain that your product or service is one-of-a-kind; if it is not, make certain that your solution is superior.
How Innovative is it?
Because your product or service is fresh to the market, it will progress as a result of specific enhancements that will propel it in an inventive direction.
Is it relevant?
The problem that your solution is going to fix is something that is happening right now.
What is well-defined?
Because your idea is more than simply a concept, you should be able to summarize the entire product lifecycle in a few lines and explain how it may be implemented to investors. Your project has already been half-way presented to investors if you have answered yes to all of the above questions. This is because investors already know what they are investing in.
How to start pitching idea to Investors:
Never begin a pitch by talking about yourself, your team, your product, or your company; instead, focus on your audience. Instead, begin with the item that is preventing you from achieving your customer’s complete and total satisfaction. You may sometimes do this by portraying an emotional picture of how your consumer is dealing with his or her problems. For example, when ATM cards were introduced, you had to wait in enormous lines to withdraw money from a bank.
Answer “Why now”
As a result, audiences — notably investors, in this case — are dubious. Their thoughts are along the lines of, “People have been living this way for a long time – are they truly going to change now?” Real-world examples must be used to illustrate this point. Consider the following scenario: If banks had never introduced ATM cards, what would have happened?
With a rising population and the need to withdraw money from the bank on a regular basis, it would have been a major issue. As a result, the struggle was genuine, kudos to the banks for coming up with such a creative problem-solving concept.
Identify obstacles—then explain how you’ll solve it:
You’ve revealed your vision for the future; now demonstrate how your company/product/service will overcome the barriers that stand in the way of reaching that goal. For example, banks came up with a solution to the problem of people withdrawing money from their accounts. As a result, after determining the customer base and identifying client addresses, remote locations where ATMs would be installed were identified.
Show evidence that you’re not bluffing:
When you’re proposing your concept, be confident and cautious. But have you ever considered that if you can produce evidence, 80 percent of the work is already done? For example, even though the ATM was only a prototype at the time, when the concept was presented, the functioning of the coded card, the PIN, and the withdrawal of money were all well explained. So, while presenting your idea, minor details make a significant difference since they demonstrate to investors that you are confident and knowledgeable about your product or service.
There are 2 main pillars for pitching business idea: MarketingRevenue Model
How do you plan on attracting millions of users/customers to your platform? In your company pitch, outline your long-term strategy from the very beginning. Your customer acquisition and marketing techniques will help you distinguish yourself from the competition. Never stop striving for the type of growth that causes investors to shout, “Take my money and tell me when to invest!” Don’t be afraid to ask questions. The marketing component of any business idea is concerned with how you will persuade people to purchase your product or service in order for your company to be profitable.
It will identify your rivals and study their strengths and shortcomings, as well as identify and quantify your target market when wondering how to pitch a business concept to a corporation.
Marketing and sales will focus on strategies for how you will reach your targeted consumers as well as how you will successfully advertise your product or service to those customers based on their geographic location and the channel via which they will be reached. In order to enhance sales, you should be well-versed in the elevator pitch while offering your product to prospective customers. Here is some advice on digital media and analytics that a start-up company should pay attention to. So let’s take a closer look at the marketing strategy to see what it is and how it might help your business.
- As a conversion target, you must have a key revenue-generating activity that is tracked.
- Key acts that precede this, such as signing up for a free trial and the many processes involved in that, are also important to keep note of. This allows you to get started with things like event tracking. For the time being, Google Analytics is sufficient.
- Unless there are a few exceptions, if you are just getting started with AdWords and you do not have conversion monitoring, you are asking for trouble.
- If you have a restricted budget for sponsored search in general, start small with a handful of keywords you believe are acceptable (including your brand name phrases), and keep the number of ad groups/campaigns/ad variants very short at first
- It becomes easier to determine when you have enough data at various levels to begin implementing improvements as a result of this practice.
- When it comes to display advertising, it is not an easy skill to master, and if you do not understand how to read the data (especially view-through conversions), you will be dissatisfied and lose money.
- Take it slowly and recognize that it may take time for you to notice a difference. If available inventory and business allow it, concentrate your early display efforts on certain DMAs or geo targets and observe if there is any increase in the amount of brand search queries on AdWords as a result.
- Become familiar with the characteristics of your advertising spots and traffic sources. The fact that certain networks receive their traffic from sources that I consider questionable raises my suspicions about the overall quality of their inventory. Similarly, some positions are just not worth the money they cost.
- Don’t squander your time with tiny, focused direct purchases at the beginning of your campaign. In comparison to using something like Google AdWords’ GDN or a DSP (assuming you know what you’re doing), it takes significantly more effort to set up and execute.
- Understand your sales cycle in terms of the number of touch points required, the length of time required, and so on. There isn’t much more to say about this except that it is quite important when setting up retargeting correctly. Not taking into consideration retargeting
- You’re leaving money on the table in terms of conversions and dollars. It is some of the most low-hanging fruit in the funnel, and while you may have to pay for superfluous touch points, the chances are that you will more than make up for it by keeping your brand in the forefront of customers’ minds across longer sales cycles.
Investors make investments because they want to earn a profit on their investment. An investor will be interested in your business concept pitch only if you can answer the following question: “How will my firm make you wealthy?” The best way to present your concept to a corporation or investor is to demonstrate that it is worthwhile for them to pursue it.
The solution is in your revenue model, which you can find here. Determine the form of revenue model you are adopting in detail, since they vary from business to business and also depend on the product and how you want to implement it. The following are the several types of revenue models:
- Subscriptions and use fees
- Bidding and auctions
- Data mining
- Revenue models popular in the financial services industry
Always think from an Investors point of view:
- Recognize the danger: Partnerships of any sort carry a significant risk. If you’re going to enter into a partnership with your investor, be sure that you’re in it for the long haul. You must be clear about the duties and obligations of each person involved
- Otherwise, your partnership will fail.
- It is essential to establish relationships: Do not focus on developing a business relationship
- Instead, concentrate on developing long-term relationships because the future is quite unclear. It’s also important not to start pitching your company concept right immediately since it establishes a transactional relationship and sets a poor tone for the whole partnership.
- Demonstrate sales volume: Because investors are mainly concerned with their returns, demonstrate how much sales you generate in a single year. To provide an example, you may claim that after six months, we have generated $200,000 in profit. Because it fosters trust, investors are more willing to make investments when presented with genuine data.
- What kind of problem do you think you can solve: Address the issue you’ve identified with your solution. Investors are interested in learning about the company strategy that provides security. Pilot surveys are occasionally provided to investors by new firms in order to demonstrate the real results before launching the full-fledged business.
- Be Specific About Your Investment Requirements: Investors want to know exactly how their money will be put to use, but they also want to see that you’ve taken the time to consider your financial requirements. Following the demonstration of where the money is spent, confidence is established.
- When it comes to dealing with investors, be prepared with specific documentation. A combination of particular documentation and a professional presentation can work wonders on any sort of investor.
You should create a visual presentation of your company plan, albeit you should keep it to 20 slides or fewer so that it is not time consuming to demonstrate to investors. Make a textual documentation of your visual presentation as well; it should be no longer than two pages in length. This gives the impression to investors that you are serious about your business and increases your self-assurance.
Learning how to pitch a business concept to an investor will not only enhance your public speaking abilities, but it can also help you spread the word about your idea/startup to a large number of individuals, friends, and family. It’s an excellent approach to get direct feedback from your potential customers and, perhaps, to attract investors or partners. So don’t be afraid to share your thoughts; it’s a good learning experience. As a result, let’s get started with your company proposal. Alcor has a business network of more than 5,000 investors spread around the globe.
By investing in 500 businesses over the course of a short fundraising cycle, we hope to add value to every smart startup at every step of its growth.
Creating a winning business pitch – 3 insights into building confidence in your business idea
Nearly a thousand early-stage company ideas are presented at 25madison each year. We are different from other venture capital firms in that we are an aVenture Studio – a company that develops companies – and as part of the process of establishing companies, we not only attend presentations, but we also produce them for each of the startups we construct. Because of this, we have a unique perspective on not just what it takes to convince others, but also on what it takes to be persuaded ourselves.
- However, with your investor audience viewing as many as 1,200 offerings for every ten investments (yes, that many!
- Cialdini’s Six Principles of Persuasion are a terrific resource for learning more about this topic.
- Continuity of confidence in both time and resources across each phase We have confidence in our ability to complete the task.
- Here are three observations we’ve made as a result of the approach.
- A compelling tale instills investor confidence that there is, in fact, a problem, and that you and your team are the best team to solve it.
So what makes a good story?
Have a legitimate and demonstrable problem. The problem that your company is attempting to solve is just as significant as the product or service that you are offering. Is this a REAL issue that will affect a big number of people and may be exploited to make a profit? Is the problem’s surrounding conditions anything that your company can help to alleviate or eliminate? Are there any other firms that might represent a threat to your operation? And are you approaching the topic from a different perspective?
Having a thorough understanding of your consumer and the environment in which your business operates tells us a great deal about how much you’ve invested in the long-term health of your company. As an illustration, the Harbor Pitch Deck demonstrates a real-world, large-scale challenge.
Create a story arc.
Your pitch, like any movie, book, or song, must take the audience on a trip that keeps them engaged the entire time. By stating the problem up front, you may provide context for what the company is attempting to solve. This provides us with a villain from whom you will be called upon to save us. Find a technique to introduce your most compelling characteristic early on in your presentation to pique people’s curiosity (more on this later on). In order to make a more convincing argument for why you are the best person to address the problem, your slides should seem like they are building on one another in a purposeful way, taking us from one point to another.
- Culminate with something that will be remembered.
- Whatever it is, whether it is a single sentence that ties everything together or three easily remembered points, tell us why we should remember you and your company.
- This will assist you in concentrating on how one item flows into the next.
- Interested in seeing how others completed the task?
Have near-term focus, with long-term vision.
Your elevator pitch should provide a clear picture of what you have done thus far. Demonstrate how much time and effort you and your team have already put in to get to where you are today. We want to know if you’re willing to put in the effort and put out the energy required to be a successful entrepreneur. However, consider this in the perspective of where you are heading. What you’ve previously accomplished should be able to provide a route to where you want your company to go in three to five years.
Here’s a check list for everything you should have remembered to bring with you:
- Underlying Magic / what distinguishes you from the crowd Reason for now
- Market opportunity
- Business Model(s)
- Next actions / plan
Not all startups are created equal, and neither should your pitch be. You’ll need to decide where to concentrate your pitch and tale based on the nature of your firm. When you consider the fact that the majority of viewers tune out after 7 minutes, you’ll want to concentrate on the areas where you succeed.
Show, don’t tell.
So you’ve written your narrative; now it’s time to share it with the world. What makes pitch decks challenging is that they must work as both an aid to live storytelling and as a follow-up document. The fact of the matter is that decision makers and investment committees will more often than not evaluate your proposal entirely on the basis of your Docsend submission. As a result, be certain that your proposal reads and presents nicely. Brand vision and visual design may fill in the gaps left by goods that have not yet been developed or teams that have not yet been formed.
We at 25madison benefit from having in-house brand strategists and creative directors, which allows us to develop visually appealing brands from the very beginning of the process.
It provides us confidence that the product will be appealing to future buyers since it has a strong brand concept. As an illustration, consider the Pattern Financial Pitch Deck, which provides a branded client experience.
A product built is better than a product imagined.
Better better, if your product is being used by actual people and generating real cash, make it the focal point of your presentation instead. In reality, we’ve invested in a number of firms that had fantastic products and people but had little or no brand recognition or even existed at all. It was necessary for us to do so since numbers don’t lie. There’s no better way to leave a prospective investor feeling assured than by demonstrating genuine product traction — as demonstrated by numerical data.
Take your concept to the next level by creating test brands and social media presences, and then using those to perform research or media testing.
Here are some of our favorite tools for you to try.
There are many of website builder templates to choose from.
At the early stage, we are investing in people + ideas.
Reality is that most early stage firms do not have a clear understanding of product-market fit; thus, we invest in the people who are working on a particular concept. Putting together an incredible team of people who are prepared to sacrifice their day jobs to concentrate on your early-stage firm speaks loudly. It also demonstrates that other people have the same vision. Introduce yourself so that we can get to know you as individuals and appreciate the variety of views that each team member brings to the table as well as the function that they play in the organization.
If your team consists of serial entrepreneurs with incredible skills that are hard to come by, we recommend that you lead your pitch with the team.
Everyone, even Alan, must put forth the necessary effort.
Deliver a presentation.
You do, in fact, have slides. Although we are capable of reading, please do not read them to us. What we don’t know about you is who you are and how you are going about establishing this company. It is one of the most common mistakes we see founders make when they are reading from their slides rather than “reading the room.” The most effective technique to deliver the presentation is to rehearse giving it in front of an audience. Practice with your co-founders before presenting to an audience.
- Axolotl is your own pet.
- Then try it without the slides to see how it goes (who knows if your PC will suddenlybluescreen from zoom sharing).
- Make a video of yourself!
- Every company has a LOT of questions that haven’t been answered yet.
It is preferable to recognize that you are aware of the risk/issue and that you have a strategy in place to minimize it rather than pretending to be unaware or to be faking it.
If you’re confident, we’re confident.
And if you do get caught up on something, it’s perfectly OK to simply acknowledge the issue and offer to follow up with further details after the meeting.
Every person in the room should have a role.
In our meetings with co-founders, we frequently witness one of them being the main focus of their presentation, while the other appears to be having no function for the dialogue (after all, why is this person even present?). Is it true that they are involved in this business?). Having one co-founder take the lead (and it’s probably even more efficient to do so) is OK; but, both founders should still be involved in the decision-making process. Tip of the day: If you’re looking for a way to save money, consider donating to a good cause.
Hello, Please enter your name here, and this is my co-founder (insert another person’s name here).
Perfect. Makes Sense. Efficient with our time.
The pitch that you make should be personalized to the audience each time you make a presentation – whether it’s to investors, competition judges, or even prospective workers – your narrative should be made relevant to the audience. Prepare yourself for the inquiry “How can we assist you?” Entrepreneurs are often eager to lend a hand to other business owners. Be honest with yourself. Getting to know you and knowing that working together will be successful, thrilling, and entertaining is important to your audience.
Hopefully, it is a match – now is the time to Do Big Things.
Good Luck! You got this.
25madison was founded in 2018 by a group of entrepreneurs led by Michael Lynton (Chairman of Snap and Warner Music Group), Steven Price (Founder of Townsquare Media and serial entrepreneur), and Matt Fremont-Smith (COO of Goldman Sachs Bank). 25madison is a venture studio with offices in New York City, Miami, Atlanta, and Tel Aviv that incubates companies from the ground up and makes early-stage investments. See this page for further information.
How to Successfully Pitch Your Business Idea to Investors
As a business owner, you must be able to effectively market your product or service. Even if you do not intend to seek investment, having a strong elevator pitch indicates that you are well-versed in your company’s operations and strategy. In case you decide to pursue investing opportunities in the future, this will come in useful.
How to make a pitch for investors
A detailed business strategy is the first step in developing a good proposal. What follows is your responsibility; you must determine what makes your company valuable and worth investing in. Despite the fact that you have 5-pages of documented financial history and a thorough study of how you compare to the competition across several industries, you simply cannot cover everything in your application.
This is due to the fact that when you’re pitching to angel investors and venture capitalists for the first time, you’ll often only have around 10-minutes to present your case. Here’s how to make your lightning-fast pitch a success.
1. Create a presentation
First and foremost, devote sufficient time to putting up your pitch deck. Creating a deck that is easy to work from and that gets investors enthused about your company is the ultimate aim. Keeping this in mind, you should prepare two versions of your pitch deck: a short version that you can deliver in ten minutes or less, and an extended one that contains everything you want potential investors to see. To get started, you may download our freepitch deck template for Powerpoint or explore our collection of more than 50 distinct Industry Pitch Decks for inspiration.
2. Practice your pitch
You’ll need to work on improving your pitch. Every other suggestion on this list is rendered virtually ineffective if you are unable to communicate effectively with each piece of your company. Too many entrepreneurs believe that just by understanding their company’s operations, they can swiftly and effectively articulate its significance. In addition, having a spectacular pitch deck with eye-popping images will serve as a solid foundation to build off of. As a result, they arrive at pitch meetings unprepared.
Prepare by practicing, simplifying your messaging, and only keeping components that contribute to the growth of your company’s brand.
3. Outline the problem with a story
Begin your pitch with an engaging tale that will keep the audience’s attention. It should be tailored to the problem you’re attempting to solve in the marketplace. This will immediately pique the interest of your target audience. And, if you’ve done any testing, try to add some actual results in this section. Even better, if you can tie your tale to your audience, in this example, the investor, you will have accomplished your goal. What sectors have they previously made investments in? What issues have they encountered in their past business endeavors?
4. Your solution
Explain what makes your product stand out from the competition and how it will address the problem you discussed in the previous slide. Keep it brief, succinct, and easy to understand so that the investor can convey it to others. If your investors are not well-versed in your business, avoid utilizing keywords to attract their attention. Again, if you’ve done any testing previously, include the findings here to lend credibility to your solution.
5. Your target market
Even though it is possible that everyone on the planet is a potential target market one day, don’t claim that everyone on the planet is a potential target market today. Remember who you’re designing your product for, and segment your market into TAM, SAM, and SOM segments to make it more manageable. The fact that your audience will be impressed as a result of this will help you think more strategically about your roll-out strategy. Consider developing an auser persona or your ideal client when speaking about your target market, if at all possible.
This can assist investors in visualizing the possible consumer base and demonstrates that you have given careful consideration to who your firm will service. A fast presentation to a particular individual is also far easier to deliver than speaking to a large demographic in a long monologue.
6. Your revenue or business model
This decline is the one that investors are most concerned about. What method will you use to generate money? Make a point of being very clear about your items and prices, and underline how eagerly your target market is expecting your arrival.
7. Your successes: Early traction and milestones
You want to establish credibility as soon as possible in the presentation. Take a few minutes to discuss the relevant traction you’ve gained so far this year. This is your chance to make a public statement about yourself. Take use of the opportunity to impress the investors with what you and your team have done to date (sales, contracts, key hires, product launches, and so on). You’ve probably stated bits and pieces of this earlier on, but here is the moment at which you develop a comprehensive picture of your company’s operations.
Show them a roadmap of the future stages, extra milestones, and even how money will aid in the achievement of these goals.
8. Customer acquisition: Marketing and sales strategy
This is one of the portions of an investor pitch and a comprehensive business plan that is most frequently skimmed over. What methods will you use to contact your customers? How much will it set you back? What will you use as a yardstick for success? Your financialsshould make it simple for you to figure out what it will cost you to acquire new customers. However, you should also provide information on how you expect to contact clients, including which platforms you will use for advertising and even a sample of messaging.
9. Your team
Investors are interested in people first and ideas second, so be sure to include specifics about your rock star team and why they are the best individuals to manage this firm when you pitch to them. Also, make sure to include any skill sets that you believe are lacking on your squad. The majority of startup teams are lacking crucial personnel, whether it’s in marketing, managerial knowledge, programmers, sales, operations, financial management, or any other area. Make it clear to them that you are aware of the fact that you do not know everything.
10. Your financial projections
Show how much income (per product) you expect to generate over the next three to five years, if possible. You must provide evidence to support your numbers by disclosing your assumptions. Investors will be pulling out their smartphone calculators to see that your figures make sense, so make sure you provide them all the information they require to ensure that your calculations are accurate. If your financial chart exhibits “hockey-stick growth,” be sure to explain what happened to produce those inflection points in the first place.
If investors are interested in hearing or learning more, provide your complete financials in the longer pitch deck or offer to answer questions after you’ve completed presenting to them.
11. Your competition
As previously said, this is a really crucial piece of your presentation, and many individuals either remove it entirely or don’t offer enough explanation about how they are significantly different from their competition. The most effective way to communicate your value proposition in comparison to your competitors’ is to present this slide in a competitive matrix format — where you list your competitors down the left side of the page, your features/benefits across the top, and checkmarks in the boxes next to the companies that provide each service.
12. Your funding needs
Clearly state how much money has previously been invested in your firm, by whom, and what percentage of ownership you now have, as well as how much more money you will require to take your company to the next level (and be clear about what level that is). Will you be required to raise further funding in various rounds? Specifically, what type of investment do you want to make: a convertible note, an equity round, or something else? Remind the audience of the reasons why your management team is capable of managing their investment for long-term expansion.
13. Your exit strategy
If you’re looking for substantial quantities of investment cash (above $1 million), most investors will want to know what your exit strategy is before they would invest in your company. Are you considering being purchased, going public (which is something that only a small number of firms really do), or something else? Demonstrate that you’ve done some research into your exit plan, including researching the organizations you’re targeting, and that you understand why it might make sense three, five, or 10 years down the line.
Investors will expect you to be able to provide evidence to support your assertions. Create an organized business plan that you can pass out to potential investors, so they can learn more about your company. After all, the goal is for you to present a compelling pitch, and at the conclusion of it, their hands will be out, demanding either your executive summary or your comprehensive business plan.
15. Take feedback and refine your pitch
Regardless of the outcome of your pitch, whether you obtain cash, a second meeting, or a rejection, always seek for ways to enhance it in the future. Don’t be hesitant to solicit criticism and use it into your pitching strategy for the next time you pitch. In this case, if the investor is unwilling to supply any, don’t press the subject any further. It is their time that you have just spent and that you are now asking for more of, so striking a balance is difficult. If possible, send another member of your team attend the meeting to take notes and then review them with them afterward.
- Even if you believe you’ve found the ideal pitch, keep refining, practicing, and executing it until you have.
- Don’t stress yourself out, and use every investor pitch as an opportunity to learn something new about yourself and your company.
- You will only become better and better as time goes on.
- An entrepreneur is someone who makes a profit.
- An advocate is someone who fights for you.
- Other entrepreneurs may benefit from her passion for teaching them how to fulfill their full potential and learn how to move outside of their comfort zones in order to stimulate their growth.
- As strategic leader, she oversees the organization’s human resource growth as well as the organization’s stakeholder engagement and community connections.
The outreach and support she gives is aimed at small and rural areas; she also coaches and mentors regional businesses and helps to develop effective local partnerships. She also conducts educational seminars.
How to Pitch a Business Idea
You’ve discovered an unmet need and put your company concept through a rigorous validation process. It’s time to start talking about your company with possible clients, prospective consumers, and future investors, among other people. However, how can you successfully explain the promise of your concept as well as the potential influence it may have on the marketplace? A business proposal presentation is one of the most nerve-wracking aspects of any entrepreneur’s journey and should be avoided at all costs.
Despite the fact that it may seem impossible, there are actions you can do to increase your chances of success.
Get instant access to your free e-book.
How to Pitch a Business Idea
Some entrepreneurs attempt to get in front of every investor, regardless of their sector experience or the stage of their company’s financing. When you take an investment, you should keep in mind that you are entering into a partnership rather than just accepting a monetary commitment. Before making your pitch, you must conduct due diligence and research on possible investors to ensure that you are well prepared. When conducting your study, consider the following questions:
- In which industries do they make investments? Several companies specialize in specialized industries. Examples include Rethink Education, a venture capital fund that invests in early- and growth-stage education technology enterprises, and Blockchain Capital, a venture capital fund that invests in companies that are innovating in the cryptocurrency sector. Identifying the sorts of businesses that the firm invests in might assist you in customizing your presentation and focusing on their expected objectives. What step of the process do they invest in? It is unlikely that you will obtain growth stock if your company is in the early phases of development. Growth equity, on the other hand, is designated for established organizations that want more cash to expand their operations, enter a new market, or purchase another business. Prepare an approximate estimate of the amount of money and resources you will require to establish your business before making your presentation, and then link yourself with investors who can assist you at that specific stage. What is the track record of the investor? Investigate the investor’s expertise and investment history in further depth to learn about the sorts of firms they normally fund, any background information they may already possess, and whether your personalities will match well together in the future. This information will allow you to revise your pitch and assess whether or not this is the appropriate person or fund with which to work.
“The greatest venture capitalists become trusted partners and advisors to the founders and team,” says Harvard Business School Professor William Sahlman in the online courseEntrepreneurship Essentials. “The best venture capitalists become trusted partners and advisors to the founders and team.” “They assist in the recruitment of essential individuals. They are responsible for introducing the firm to potential clients. They assist in the raising of successive rounds of money. When they do this, they are sending a signal to the market that the business they have backed is a winner, which helps to confirm that assumption.
2. Consider How You’re Presenting Yourself, Not Simply Your Idea
Although your thoughts and abilities are vital, your personality is equally as crucial. Research published in the Harvard Business Review indicated that venture investors’ interest in a firm was “motivated less by judgements that the founder was skilled than by assessments of character and trustworthiness” of the founder. Investors also want to be certain that they are going into a partnership with the appropriate individuals. The co-founder of Aspect Ventures, Jennifer Fonstad, states inEntrepreneurship Essentials that her investment business “considers team and team chemistry to be quite important.” It is important for investors to know whether the founders have previously collaborated, whether the early employees of your firm have complementary skill sets, and whether you are able to be flexible, open-minded, and prepared to accept diverse points of view.
Consider this when you are preparing your pitch presentation.
When they ask for financial estimates, are you going to embellish the figures or will you be honest with them?
Sahlman emphasizes this point in Entrepreneurship Essentials: “The majority of experienced investors look at the people first, and the opportunity second.” The ability to make the proper judgments is critical for investors even when a team is young and inexperienced.”
3. Tell a Story
Whenever you’re explaining your company concept, focus on the problem you’re solving and how you’re doing it better than your competitors. In order to do this, you may use a real-life scenario in which you illustrate the pain point that an existing or potential consumer was experiencing and how your product or service alleviated the problem. This might assist you in engaging investors on a personal level and inspiring them to recognize the potential of your project. By including an engaging tale to accompany your spreadsheets and statistics, you can build a more complete picture of your startup’s future and more effectively emphasize the opportunities in the market.
4. Cover the Details
While it is critical to establish the overall tone, it is equally necessary to go through the specifics. Provide investors with a memorable tagline to take away from your pitch deck by succinctly defining your value proposition and sharing it in your pitch deck. From there, communicate the opportunity and the specifics:
- In addition to setting the atmosphere, it is necessary to go through the contents of what will be discussed. Provide investors with a memorable slogan to take away from the meeting by defining your value proposition succinctly in your pitch deck. Afterwards, communicate the opportunity and the following information:
Sahlman writes in Entrepreneurship Essentials that “in general, investors are more concerned with understanding how entrepreneurs think about the opportunity than they are with evaluating their presentation or prediction abilities.” “They are looking for realistic optimism and confidence. They are not fond of forecasts that are too optimistic. They’ve seen far too many businesses fail to meet their objectives and end up in difficulties.”
5. Show the Roadmap
Despite the fact that you are in the early phases of your firm, investors want to know how they will get paid at the end of the day. To seal the deal on your pitch, emphasize your departure strategy as well as the various possibilities accessible. As Sahlman explains, “investors like to fund enterprises that have a wide range of exit possibilities.” “They are interested in learning how they may transform their investment into cash that they can distribute to their partners.” The following are the most often used escape strategies:
- Acquisition: When one firm purchases the majority of or all of the stock of another company in order to obtain control of it. Merger: When two existing businesses are combined to form a single new enterprise. A private company’s initial public offering (IPO) is when it sells its first shares of stock to the general public and becomes eligible to begin raising funds from the general public.
Acquisitions and mergers are both terms that are used to describe the same thing. There are four major risks.
Landing the Pitch
Every investor has a different set of priorities when it comes to data and information. However, if you begin by selecting the most appropriate investor and then match their requirements with your suggested market opportunity, value proposition, and exit strategy, you stand a good chance of landing the pitch. Check out our four-week online courseEntrepreneurship Essentialsand our other entrepreneurship and innovation courses if you’re interested in learning more about what investors look for and how you can generate value.
About the Author
Ms. Lauren Landry is the assistant director of marketing and communications for Harvard Business School Online, where she has worked since 2007. Prior to joining HBS Online, she worked at Northeastern University and BostInno, where she produced approximately 3,500 pieces on early-stage technology and education, including the very first article published on the HBS Online website.
She has a bachelor’s degree in English literature. When she’s not working at HBS Online, you can find her teaching a course on digital media at Emerson College, sipping coffee, or delivering really dumb jokes to anybody who will listen.