How to Pitch a Potential Investor
By Stewart Townsend on Oct 28, 2009
Scary. Nerve-wracking. Exciting. Game changing. There are several ways to describe what it's like to pitch to a venture capitalist (VC) or angel investor, but boring typically isn't one of them. Considering the possibilities that go along with an large influx of cash, the experience of pitching a VC is both invigorating and anxiety-ridden at the same time. Here are six ways to make the job a little easier.
1. Research, research, research. Make absolutely sure you know your audience. At the very minimum, make sure you read up on the company, investor biographies, and some of the startups they've funded in the past. Another really great way to do due diligence on the people you're pitching to is to connect with someone they've funded in the past, or even an entrepreneur they turned down. You'll get the inside scoop on what to expect, what works, and what might not.
2. Rehearse. Don't think you can go into a pitch meeting with little or no preparation and expect to succeed. Even though you know your company better than anyone, you still need to get your ducks in a row and be prepared with answers to tough questions. If you're taking a slide deck with you, make sure to rehearse until the entire presentation is second nature to you.
3. Prepare a good elevator pitch. Ed Sim, Managing Director of Dawntreader Ventures, recommends you go to your meeting armed with an elevator pitch. "If you can't explain to me succinctly what your product does, what problem it solves, and how you will make money then I wonder how you will explain it to your customers. Don't worry, I want to see your baby in action, but save the demo for later as I want to hear you articulate these points first."
4. Keep your emotions in check. Pitching to a potential investor can be exhilarating and exhausting at the same time. While you want to appear passionate about your startup, you don't want to be overly-confident to the point that you alienate the VC. Investors will be assessing the viability of a long-term relationship with your company so make sure you let them know you're a team player and easy to work with.
5. Listen to feedback. While you may know more than most anybody about your company and even your industry, VCs bring loads of experience and wisdom to the table. You can learn a lot from them by simply listening to their feedback an opinions. Even if the investors choose not to fund your startup, you can still use the pitch experience to learn about the process and what VCs are looking for so you're in better shape next time you try.
6. Be authentic. David Beisel, Vice President of the venture firm Venrock, advises, "Entrepreneurs should present themselves and their businesses genuinely as they are. Attempts to 'dress up' or 'massage' their own individual backgrounds or the current company situation which aren't a true reflection of reality will be either immediately recognized or discovered later in the due diligence process. Obviously, in any introductory meeting, one should put his/her best foot forward, but never at the expense of the truth."
Flickr image courtesy of artolog.