Pitching for investment is – without doubt – one of the scariest things you’ll ever do as an entrepreneur. It’s the moment that you put your ideas, concept and hard work on the line. It’s the moment you begin to realise the worth and potential of your idea. It can often be a long process, riddled with rejection and disappointment. The important thing to remember is to just keep refining and searching for the next investor. It can take a few pitches to understand what not to do. So, we thought we’d help speed the process up and show you the mistakes others have made.
1. Your elevator pitch goes on for hours
The ‘elevator pitch’ is your one chance to shine. It’s the small amount of time where you should sell the dream. This is where you explain how your idea will change the world and inspire others. In essence, this is the small pitch that will hook in your investors. It should be intriguing, inspirational and – most of all – short. If you can’t condense your product into a one minute elevator pitch, it’s too long. You’ll lose their interest.
2. You don’t have a strong business plan
Once you’ve wowed the investors with the big picture and the dream, it’s time to dig into the business. The first thing to learn is that investors are there for the money. Investors are looking for a company that has direction, skill and precision. They want to know where the company is going. They need to know how big the markets share is, what your audience looks like. They want to hear the competitive advantage over your rivals. Most importantly, they want cold, hard facts about the money. How much is going in? What are your projections? How will they make money?
3. You don’t have a prototype
If you’re pitching a product, you need to take a prototype. Investors need to see the invention they are investing in. If a picture paints a thousand words, a prototype paints a million. They need to see it in action. Speak to a company like Trade CNC and get your first prototype made up.
4. You don’t tell the investor how they will make money
Like we said before, investors are there for one thing: the money. Talk to them directly about their investment. What exactly will their money be used for and how will they make it back? You need to show them a realistic, viable return on investment within 3-6 years. Only that will convince investors to split with their money.
5. You don’t listen
Good investors will ask you a lot of questions after your pitch. They may challenge your product, your business plan or your ideas. This is completely normal, they are testing your resolve and your knowledge. They’re making sure that you know it inside out. Listen to what they are saying and address their concerns personally.
It may take a few pitches to get into your stride, but don’t get disheartened. There is a lot of money out there. You’ll find the right investor eventually.