Most businesses need funding to grow or scale. But the majority of entrepreneurs seeking money often get rejected by investors. In this article, we will use two investors’ perspective on seeking investments to help you learn what to avoid during your next pitch to investors.
Here are the 3 major things investors look for in a winning business plan according to Evan Carmichael:
- Short, Concise, Clear and Easy to understand Executive Summary
- Strong and Experienced Leadership and Management Team and/or Board of Advisors
- Solid NUMBERS – Detailed Financials and Projections that get investors excited
And here are the main tips to remember before or during your next investor meeting according to Alicia Syrett:
Rookie Mistakes
- Do your homework – Don’t pitch investors without researching them first
- Introductions and in-person networking trump cold calls and cold emails
- Timing of the pitch is important
Your character matters
- Don’t be sketchy offline or online
- Don’t overpromise
- Show that you will use the money for the growth of the company and not for your salary or other reasons
Investor-Entrepreneur Fit matters
- Articulate how they can help you beyond just the money
- Adjust your pitch over time to fit the specific investor
- Get them excited to work with you and create FOMO (fear of missing out) if they don’t
Business Fundamentals
- Don’t focus on small or highly competitive markets
- A good business to invest in is one that can’t be easily replicated by your competition
- Show some momentum on the execution of the idea – initial customers, initial partnerships, initial capital, etc
- Know your numbers – revenues, growth margin, metrics, profitability – they have to be compelling and core to your story
If you liked this article, you might also like this one about Business partnerships, family, support and relationships in business
Please share in the comments any insights you have on this article. What is your business and when do you plan to get funding? If you are an investor, what are your thoughts on investing? Share below
