Your startup is off the ground and the first few months have seen you gain traction in your chosen field; good job, the easy part is done. What comes next will be one of the most daunting, challenging, but ultimately rewarding, experiences you can have.
Accessing finance is one of the biggest challenges any startup will ever face, with companies as large as AirBnB stating the difficulties they faced in getting the seed capital required to get them off the ground.
When you’re in the middle of any crowdfunding campaign, we’ve found it wise to try to meet potential investors and many platforms will offer you this opportunity. If you do get the chance to perform in front of a crowd, preparation, form and delivery are everything. Here are five points you simply can’t afford to ignore when pitching.
The pitch deck – short and sweet – investors are incredibly busy and have ideas thrown at them all the time. In all honesty, you have around one minute to grab enough of their attention that they ask follow-up questions and engage with your product. Try to stick to the TED talk formula of one slide every 60–90 seconds.
Not adding everything to your slides will keep your audience interested and engaged with you as a speaker. Use images and highlight important statistics only when necessary; you want to keep the focus on you.
Be realistic with your projections
Growth is important and something all investors will have a keen eye on. However, figures used in your presentations should be realistic. Hockey-stick growth exists, but it’s very, very rare. A realistic forecast backed up with facts and well-reasoned research is less likely to trip you up in the future.
Know your competitors – as the saying goes, keep your friends close and your enemies closer. Before pitching to any investors, you have to know your competitors inside and out. And you will have competitors – they may do almost exactly what you do or you may be trying to replace them.
Investors will ask you about them and they will want to know how and why your offering is better. What is it that differentiates you? For the most part, investors will want to be sure that you are aware of the competition and that you have a plan to beat them – or pilfer their clients.
Stick to the facts – any investor will do their due diligence and background checks on you, and will likely be looking for a reason not to invest. Make sure you stick to the facts when you are discussing your team, your product, how far along you are and any essential information about your business throughout the presentation. Exaggerating your own – or your team’s – achievements can come back to haunt you at a later stage. Sumi Thaker, CEO of Momentum Bioscience – a company that recently raised crowdfunded finance on SyndicateRoom – agrees, stating that ‘I think you just really need to know your market and your business model, and it needs to be inside out and ready for questions that come from any direction.’
Practice makes perfect – you will have to be ready to answer the tough questions and with confidence, so one of the most important pieces of advice to follow is to practice your pitch in front of somebody you can trust to give you honest feedback and question what you have said. Pick someone with enough experience to help by asking the hard questions.
You’re going to get hammered on your experience – what makes yours the right team to deliver this product/service?
You’re going to get drilled on your projections – how exactly are you going to increase sales as dramatically as you make out in your charts?
You will get grilled on your competition (if you follow the advice in point number three, you will be prepared).
Use the above as a guideline for preparing for your pitch to investors and you’ll give yourself a good chance of, at the very least, getting your project a second look.