How To Prepare to Pitch Investors

4 min read · 2 weeks ago

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If you’ve ever seen Shark Tank, you know that investors are fickle, finicky individuals. After all, they’re putting their money into your business. They want to see success. While you’re probably not pitching to investors on national television, you’ll need to prepare to pitch investors to get the money your startup needs.

There are no baseballs or mounds involved in the investor pitch. It’s just you and your idea in front of investors who might be willing to fund your business. What you say when you ask them for the funding, that’s your investment pitch. 

Of course, the first step in landing startup capital is to find investors. We covered six different ways to find people who can help your business grow in a recent article. This one assumes that you’ve already done that important step. Now, you need to prepare to pitch investors. These strategies will help:

  • Research your audience
  • Create a pitch deck
  • Tell a story
  • Know your revenue model
  • Focus on successes
  • Practice, practice some more

 

Research Your Audience

An investment pitch should not be something you improvise. Waiting until the last minute to plan your pitch or, worse still, “winging it” is unlikely to help get your business where you want it to go.

One key initial step is to research your audience. Once you find an investor and are invited in to present, do your own due diligence. Find out who exactly you will be speaking to and learn all you can about that individual. No, you don’t need to know the person’s dog’s name or zodiac sign. Yet, it can help you to tailor your pitch to appeal to that particular investor if you understand:

  • What kinds of investments do they tend to make?
  • What particular areas are they passionate about?
  • What’s their professional background?
  • How involved do they like to be in their investments?
  • Do they know your industry?
  • Are they a new or seasoned investor? 

 

Create a Pitch Deck

A successful pitch deck gets investors excited and gives you something to work from when talking with them. As the Pitch Prof puts it, “Don’t just build the deck; design it.” The pitch deck needs to capture the audience (not just those in the front of the room, so make text and visuals big enough for everyone to see).

Other pitch decks do’s include:

 Limit each slide to one idea only

  • Keep a consistent look throughout
  • Remember the first few minutes are the most important
  • Show your people
  • Avoid overusing bullets
  • Familiarize yourself with the material so that you can make eye contact rather than reading a script

Check out the pitch decks of some now big companies, including Airbnb, LinkedIn, and Square, here!

 

Tell a Story

By this, we don’t mean a novel. You need to keep your entire pitch concise. But it can help engage your audience and appeal to their emotions to be descriptive about the problem your business will solve. Stories are what resonates with the audience. Telling your origin story can help to communicate why you’re different.

At the same time, though, the PitchProf suggests using stories intentionally. Hooking the audience and asking them to empathize with your story can work in the pitch, but this isn’t what you want to be doing in the question and answer period of the pitch. That’s when investors want specificity and data when they ask you how many customers you have or envision having. They don’t want to hear the “once upon a time” story at that moment.

Want to know other mistakes to avoid? Review our list of 28 things to avoid when meeting with investors.

 

Know Your Revenue Model

Investors will expect you to know this. You should be able to clearly and directly communicate how your business plans to make its money. Airbnb’s model in its pitch deck was quite simple: 

There are, of course, many different business models. You might sell subscriptions, ask for one-time payments, or generate advertising revenue. 

In addition to having a revenue model, it’s also important to lay out:

  • Your leadership continuity plan
  • Future plans as the company grows
  • Largest risks 
  • Competitors in the space
  • Final exit strategy

 

Focus on Successes

People like to bet on winners. Investors are effectively betting on your business by giving you funding. Make it easier for them to believe that they’ll see a return on their investment by highlighting any success thus far.

Sharing any early traction adds credibility to your pitch. Venture capitalist Caroline Cummings writes, “Impress the investors with what you and your team have accomplished to date (sales, contracts, key hires, product launches, and so on).” But, she adds, “don’t just leave it at what you’ve done, be sure to speak to where you’re going.”

 

Practice, Practice Some More

The investment pitch is your chance to change the trajectory of your business. We’ll say it again: don’t underestimate the importance of preparing your pitch and practicing it over and again. 

With practice, you’ll be able to speak to any element of the pitch deck with authority. Plus, you’ll know how long it takes you to present your ideas. Rehearsing in front of an audience can also help you know if you’re talking too fast or have some physical tick that could distract from what you’re saying.

 

Pitch Investors With Confidence

Ultimately, you need to convey confidence to instill faith in investors. Investing your time to prepare to pitch investors is going to help set your business idea apart. You’ll feel ready, and your prospective investors will be able to focus on your vision and metrics. Then, together, you can make your business grow.