Perfecting Your Pitch
The first step for every venture as it evolves from idea to reality is belief— belief on the part of the entrepreneur that their idea is one worth investing energy. Obviously, one believer is not enough — the rest of the entrepreneurial journey is all about convincing other people to buy in as well. This is what you’re doing each time you market your product or hire a new employee. But it happens most explicitly when you pitch to investors. Below are four keys to successful pitching:
Create a connection over shared experiences
It is human nature to want to connect with other people. Those watching your pitch are waiting for that interpersonal connection. Your solution, ideally, will be something they have never quite seen before, but the problem you are solving should be something your audience can understand and empathize with. If the problem is specific to a certain industry, try to find a common denominator that the average investor can relate to (i.e. “Don’t you hate it when you ship something and it doesn’t arrive on time? For most of us that’s an inconvenience, but for medical devices the difference can be life and death.”)
Concisely explain your business model
There are lots of details and minutiae that go into becoming profitable, especially early in the lifecycle of a business. But when pitching to investors try and take the birds eye view of your business model. Focus on financial levers that will driving growth, and demonstrate scalability within those lines of business. A popular slide when pitching is market size (“The global bridal wear market is expected to reach $56B in 2017!”) This is helpful to communicate potential upsides but is irrelevant if investors can’t understand how you plan to penetrate the market. They say a picture is worth 1000 words, and pitching is no different. An effective visual representation of your operations can help investors to understand your business model and make your pitch uniquely memorable
Demonstrate your passion
When investors decide to put their money into a venture, especially those at an early stage, it is as much a bet on the entrepreneur as it is on their idea. In the long run your product will adapt and your business plan will inevitably change. In fact, the only constant is you. What investors want to see is that the founder is in it for the long haul and that they will have the passion to weather adversity. Make sure to articulate why you got into the business in the first place, and how this drive makes you the right person to be entrusted with investment dollars.
Tell a story people want to be a part of
None of us want to miss the next big thing. This is especially true for investors, whose job it is to find great stories and be part of them. So when pitching, don’t get too stuck on the details and lose the forest for the trees. Find the great story you have to tell, and communicate the most important parts. All stories have a beginning, middle, and end. The beginning should have already happened —that’s why you’re pitching — and it should be formulated into an engaging origin story. While the end might be a ways off, your exit strategy must be articulated so that the audience understands how they are going to recoup their investments. Once everyone understands the beginning and the end, it’s about communicating your current place in the story, and convincing others that the rest of the journey is one worth joining.
At the end of the day, each pitch is an opportunity to test your concept, gather feedback, and evolve your presentation. And remember, the goal is not only to get investment but to find the right investor. And that will happen if you communicate authentically and clearly about your progress, your goals, and why you believe.