Here we cover some of the do's and don'ts that startup owners should keep in their mind while pitching the investors. Following this is important because most of today's startups fail to convince investors because of a lack of proper planning of pitches.?
- Know your audience: Before pitching the potential investors, it's good to know their expectations regarding a successful business. This might include a thorough background study, their current investments and investments criteria, expected returns, growth and other qualities.?
After knowing the investors, the next step is to prepare a pitch for approaching them. It can be a pitch deck with all relevant information regarding the startup, like its financials, customer data and business model. Such decks should also include visual representations like charts and graphs to make them more appealing and effective. Most importantly, the deck should address the interests and needs of the investors, demonstrating how the investments become worthy for them. Lastly, regular practice of the presentation will help startup owners to present the deck with confidence.?
- Do not dumb too much information into the pitch: Startup owners should know that a successful pitch should be concise and focused and not contain too much information. At the same time, it should cover all aspects of the facets of new business in the first attempt itself. This is because the investors will need more time for each pitch. Thus startup owners should make their pitch clear and well-structured by avoiding too much fit-in.??
- Please focus on the best: Startups need not discuss all their ideas in detail during the pitch. It is always good to focus on those ideas that do best. This might be a unique approach to a problem, or sometimes it may be a unique business model. After identifying the best, startups should focus on communicating this concisely during the pitch.?
- Refrain from assuming what investors want to hear: While pitching the investors, it's always good not to assume what they want. Instead, it's good for startups to be honest and realistic. Investors are more likely to know facts and understand the risk involved. Making pre-assumption will make startups end up providing investors with accurate and accurate information regarding the business. Thus, being realistic and honest will help startups gain investors' trust, enabling them to make informed decisions about whether or not they should invest in the business.
- Prepare for tough questions: This can be done by going through some essential steps before approaching the investors. As a first step towards this, read up on current industry trends and market developments. This will help startup owners anticipate the investors' potential questions and get ready to answer them during the pitch. Secondly, practising answering tricky questions in mock interviews or with a peer or mentor will help in boosting confidence and helps to answer calmly and confidently. Finally, if you don't know the answer, admitting it before the panel is always good. Also, don't be defensive and take criticism personally; instead, take it as an opportunity to handle a situation under pressure.
- Only become discouraged if you get the funding: Getting discouraged for not getting funded is not suitable for a startup owner. In such cases, owners should understand that this funding process often takes some time. Instead of getting discouraged, they can use this time to refine the proposal to make it better and identify the areas of improvement. Simultaneously, they can also search for other funding sources. Finally, startups can also seek advice from others who have been successful in their funding to take notes of important things to follow, which they might have forgotten in the first approach.?
- Make sure follow-ups happen after the pitch: This is an essential step in the venture capital process. This not only helps demonstrate the commitment to the venture but also provides startup owners to provide investors with additional information, respond to any additional questions if they have any and develop a good relationship, leading to future opportunities.?
- Try to learn from mistakes: This is important because new entrepreneurs often give up after their first round of pitches or in the first rejection. Instead, they should learn from their mistakes and understand that pitching is a skill that can be achieved and improved with practice and following the feedback from the investors.?
Thus it's understandable that startup pitching is not an easy process. But once done correctly, it will result in tremendous success for entrepreneurs and investors. By following the above dos and don'ts, startup owners can ensure they are heading up with the right pitch in receiving investments from investors.
Attracting investors is a time-consuming process that is incredibly difficult. Due to their lack of prior business experience, startups are a case in point. The business world of today is evolving quickly, so if you are looking for ways to draw investors, you need to be well-organized and ready. Having trouble finding investors for your startup? Let us help you find the right investor!
