If you’re looking to find someone to invest a large sum of money into a business of yours that’s still pre-revenue, you’re going to need to know how to effectively sell that idea to potential investors. Here are three tips to remember when trying to pitch your business to prospective investors.
Keep it short and sweet
An elevator pitch is vital. Lengthy presentations and long-winded explanations aren’t going to impress investors. They’ll most likely turn them off from your business. You need to present your business in a way that’s short, sweet, and to the point. Investors need to know that your business will attract customers. If they can’t grasp your concept in a short amount of time, they’re going to assume that customers won’t either.
You need to excite investors about your big picture, while still keeping things reasonable. Avoid nonsensical financial projections that claim your company’s revenues will grow from $100,000 to $30 million in two years. You need to show investors that you have a grasp on reality with a best case, moderate case, and worst case financial projections. These should be based on fact, past/present performance data, industry analysis, etc.
Don’t be the smartest person in the room
It’s okay not to know everything, but you need to know what you don’t know and find the people who know what you don’t know. Essentially you’re looking to build a team of experts, and surround yourself with smarter people than yourself. Investors are looking to fund a management team as much as they’re investing in a great business concept.