Many entrepreneurs are looking for investors to fund their business ideas, but they don’t know how to go about it. It can be a daunting task, but here are nine tips that will help you ace your pitch!
First, do your research on what investors are interested in investing in.
To get investors excited about your business idea, you need to show that investors will see a return on their money. There are many investors out there who invest in different types of businesses and industries – some investors for example may be more interested in restaurants than they would software companies. Some investors might be interested only in certain geographic locations or specific cities. You want to know what type of business an investor invests in before you pitch them because it demonstrates how passionate and knowledgeable you are about the industry as well as their interests. If you can show this during your meeting with them then they will trust that you have done your homework and hopefully give your business idea serious consideration!
Make sure you have an elevator pitch that is short and concise.
People have a tendency to ramble on about their business idea which investors hate. If you can’t explain your business in a few sentences then it is going to be much harder for investors to learn more and become interested or invested in what you are doing. Investors want people who know how to clearly communicate ideas quickly so they don’t lose interest while listening.
Highlight the ways your business is different.
Investors get pitched ideas all the time, so you need to make sure that yours is unique and looks appealing. There are investors who want to fund different kinds of business ventures but they aren’t interested in hearing about your business idea if it sounds similar or identical to another one! You will have a really hard time getting investors on board with your project if there isn’t anything original about it. Find ways to stand out from other businesses by coming up with something new and creative rather than just copying what others have done before you. It can pay off big time when investors see how innovative your business is compared to everything else out there!
Get Feedback From Others.
Before you present your business idea to investors, get feedback from other people. Their outside perspective will help you see potential holes in the plan that investors might pick up on when they hear about it for the first time. When receiving feedback, listen carefully without getting defensive or emotional. It’s not advisable to share too much detail initially or overwhelm someone by giving them everything upfront or trying to force-feed them information, so be selective about how many details you want to give away initially.
Do Your Research.
When it comes to pitching investors, do your research and know who you’re talking to before you go into the meeting! Find out as much about them as possible: their background/experience; interests; locations (are they local for a face-to-face meeting?); etc. You can find this information online or by making some phone calls. It will come in handy when crafting your pitch because investors like hearing stories from people that are similar to themselves – so matching up what you have discovered with something investors relate to makes your presentation more relatable and convincing. If an investor doesn’t relate well with your story or there’s nothing in common between the two of you, then the investment opportunity might not be a good fit for them.
Be prepared for investor’s questions.
Have specific answers ready to the most common questions investors ask. For example, what are your business goals? How much money do you need and how will it be used? What is your market size, who are your competitors? Be honest at all times. Don’t try to make yourself or an investor believe something that isn’t true.
Admit your weaknesses.
Don’t try to give investors a false sense of security by not admitting your weaknesses. Acknowledging those issues will make investors feel more secure about their investment because they will see you are being transparent with them.
Try to stay calm throughout the meeting.
Investors may find nervous people more difficult to trust with their money so even if you’re feeling anxious inside, keep a cool exterior! Try to sound confident, too. Being well-prepared and demonstrating your confidence will increase investors’ trust in you. Be polite, respectful, and professional throughout the meeting. Even if investors are rude or dismissive during the meeting do not take it personally; they might simply be too busy with other deals or have different standards for what constitutes a good business idea. Just because one investor doesn’t like your pitch does not mean that no investors will want to work with you so stay positive about the entire experience!
Have high-quality presentation materials ready before pitching investors.
Your presentation should have an attractive design, clearly explain your business idea and its value proposition to investors, and persuasively convey the benefits of investing in your business. Try creating a “pitch deck” that investors can access while you are pitching them so they know exactly what information about the business is important to them.
Sound ambitious during the pitch.
Investors want to see that you’re ambitious when it comes to growing their investment; if there’s no clear path for growth then investors may not feel comfortable putting money into your project. Having goals such as increasing sales by tenfold or opening new branches within five years will make investors more confident in the decision they made because it shows how serious you are about expanding and achieving success with their help! Just make sure not to sound overly optimistic. If your goals aren’t realistic, investors will be less likely to trust that you know what you’re doing and therefore won’t feel comfortable giving money away.
Make your investors feel included.
Not only will investors want to know how you are going about doing things, but they also probably have a lot of experience and knowledge that could benefit the business as well. They may be able to make connections or expose you to new opportunities as well as provide feedback on what is working and not working with the company’s direction.
Be specific about where their funding would go.
Don’t forget investors want to know what their money is going towards and how it’s being used. Be specific with your numbers and explanations of where the business’ funding is going towards. If investors can’t see where their money is going it makes them feel as if they aren’t included or that the business isn’t transparent.
Remember that investors are not only investing in your business but in you. Be sure to treat investors with respect and be honest about how much work needs to go into the business. Be confident but not cocky. Know who you’re talking to and what they want from your pitch. Show them that you’ve done all of your research on their company or organization before presenting yourself as a potential partner in success. Make sure that everything is clear by using graphs, visuals, and other tools to break up longer sentences so people can digest it better. And most importantly, keep things short – don’t overstay your welcome with an unnecessarily long presentation! Hopefully, these nine tips will help you feel more confident about pitching investors.
If you’re still struggling to prepare for your pitch with investors, make sure to check out our post discussing the ways that a pitch coach may be beneficial for you, as well as our article outlining five great choices for pitch coaches.