BEFORE YOU TALK TO AN INVESTOR, AVOID THE FOLLOWING MISTAKES
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“Stop telling an investor you are solving a problem…”
If you don’t have that rich uncle or parents to give you all
the money you will need to start your business, you probably have one or two
options left to finance your dream business.
Part of which include diving into the investor pool.
If
getting an investor is your desired path there are several mistakes you need to
avoid.
Make no mistake; every time you go in front of a venture
capitalist or an investor, your funding fate is driven not by your company’s
true potential, but by how well you communicate that business potential.
A great business pitch is a great performance.
Your top priority is to ask yourself what do i need to say
to get my investor’s juices flowing?
A great business often is buried behind a bad pitch to investors.
A great business often is buried behind a bad pitch to investors.
McAdory Lipscomb Jr, of Accenture’s global lead capital investment had worked with hundreds of CEOs for many years, and had seen the best and the worst of them.
Stop saying you're solving a problem and other common mistakes entrepreneurs or business owners make when presenting to investors.
Here are the five that was seen most often and how to fix them.
Mistake One
Most entrepreneurs didn’t do their homework on the Investor.
Understand your investor. Money never comes if they have no interest in your market.
If you are launching a direct-to-consumer health care comparison platform and you are looking for $500,000 seed investment, it makes no sense to pitch to an investor who only does Business to Business technology platforms with an average $2million “A” round venture investment.
Similar to what Seth Godin earlier said on how to get your ideas spread, you must pitch your business in front of the right venture capitalist.
Investor’s interest in your industry is a key to getting funded.
Mistake Two
Most entrepreneurs saved the “investment ask” for the last.
Your writing teacher wanted you to go for the big finish with the last chapter of your book.
This is backwards for the investor.
Stop saying you're solving a problem and other common mistakes entrepreneurs or business owners make when presenting to investors.
Here are the five that was seen most often and how to fix them.
Mistake One
Most entrepreneurs didn’t do their homework on the Investor.
Understand your investor. Money never comes if they have no interest in your market.
If you are launching a direct-to-consumer health care comparison platform and you are looking for $500,000 seed investment, it makes no sense to pitch to an investor who only does Business to Business technology platforms with an average $2million “A” round venture investment.
Similar to what Seth Godin earlier said on how to get your ideas spread, you must pitch your business in front of the right venture capitalist.
Investor’s interest in your industry is a key to getting funded.
Mistake Two
Most entrepreneurs saved the “investment ask” for the last.
Your writing teacher wanted you to go for the big finish with the last chapter of your book.
This is backwards for the investor.
Before the presentation, you should have written a script. Build a summary deck without screen shots.
The business fundamentals are the same; it’s just how much color you add to each business point that enables you to expand and contract the pitch. Stick to the script and rehearse (out loud).
Imagine a politician running for office with key talking points. They repeat them over and over but continue to make them sound fresh. That’s exactly what you have to do.
Now you’re ready. You start your business or pitching conversation with a business point: “I am here to raise $500,000 to grow my business. Let me tell you about it.”
(Don’t give a range; if you say $400,000 to $600,000 the investor hears $400,000. You started a negotiation at the wrong place.)
Next, review an agenda for the meeting and provide a road map of where this presentation is going and what they will hear. With the agenda you’ve accomplished several little content victories in the first 30 seconds.
You’ve signaled that you’re going to talk business (not show pictures of your baby), established presentation milestones, defined the key business points they are usually listening for, and qualified that the investment amount is realistic.
The business fundamentals are the same; it’s just how much color you add to each business point that enables you to expand and contract the pitch. Stick to the script and rehearse (out loud).
Imagine a politician running for office with key talking points. They repeat them over and over but continue to make them sound fresh. That’s exactly what you have to do.
Now you’re ready. You start your business or pitching conversation with a business point: “I am here to raise $500,000 to grow my business. Let me tell you about it.”
(Don’t give a range; if you say $400,000 to $600,000 the investor hears $400,000. You started a negotiation at the wrong place.)
Next, review an agenda for the meeting and provide a road map of where this presentation is going and what they will hear. With the agenda you’ve accomplished several little content victories in the first 30 seconds.
You’ve signaled that you’re going to talk business (not show pictures of your baby), established presentation milestones, defined the key business points they are usually listening for, and qualified that the investment amount is realistic.
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Highly Recommended Business Development Book that can help you build the successful
business of your dream: BEFORE YOU START YOUR BUSINESS (12 proven secrets for business success as shared by business gurus)
business of your dream: BEFORE YOU START YOUR BUSINESS (12 proven secrets for business success as shared by business gurus)
Mistake Three
You and the investor rambled on about what you’ve done and what you're doing.
A rambling presentation is the kiss of death. Investors get bored and start thinking, “when are you going to get to what I want to know?"
You might be given a reprieve because the investor will take over and start asking questions. That’s not a good thing. If that happens, you have lost control of your pitch and your allotted 20 minutes will be exhausted.
If you made the investor dig through your ramblings to find the business opportunity, you’ve probably failed the audition.
Avoid making the investors highjack your pitch from you before you tell them what they need to know about your business. Where the money is and how to get there?
This is an excerpt from my newly published ebook that can help you build a success business.
Other books by Moyo Samuel
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