Pitching to investors can be one of the most nerve wracking situations around, but it’s important to retain your cool and stay on target to get the best chance of securing that important investment. Avoid these errors in order to bolster your chances.
Preparation is key to a successful presentation to investors. Most investors will want to go over your business with a fine-tooth comb before they invest, otherwise there’s a chance they could miss something and lose all their money. You must be able to succinctly answer any questions, particularly on why you need the investment and what it’s going to be used for. If you can’t answer these then getting investment is going to prove extremely difficult.
Poor personal presentation
Investors want to deal with professionals; when you enter the room and begin your pitch you are selling yourself – and your ability to deliver – constantly. First impressions are essential so make a good one. Tidy your hair, wear a suit, polish your shoes and put on cufflinks. Take yourself seriously, take the investors seriously and you’ll be taken seriously in return. Whilst making a bad first impression can reduce your chances of getting investment, impressing investors with your demeanour and presentation can really increase your chances.
Lack of confidence
If you don’t have confidence in yourself then it’s going to be difficult to convince investors to have confidence in you. While we all get nervous, if you start fidgeting, speaking poorly, losing your place or generally acting anxious it’s going to look unprofessional, and will quickly turn investors off. Investors invest in businesses only when they are confident the owner(s) have the attitude to make the firm a success. If you struggle to maintain yourself when making a presentation, they’ll no doubt worry you won’t be able to handle the often incredibly stressful world of business.
Too good to be true
When it comes to investing, offers that seem too good to be true will send a warning signal to investors. All businesses, even the ones pushing the most innovative products, find it difficult to gain market share and get off the ground. By only revealing half the picture or missing out less than savoury details, your investors may consider you to be inexperienced or unreliable. Present a solid case that offers upside despite the inherent risks in business, and your investors will be more likely to back you. They want to work with someone who’s down to earth and logical, so show them they’re safe with you.
Confused by figures
A rational grasp of the financial side of business will go down extremely well with investors, who after all are looking for a good return on their investment. Businesses that do not consider the monetary side of the company often fail quickly due to poor liquidity or too many outgoings alongside insufficient revenue. When presenting to investors, at the very least you need to know your profits and losses for the past five years and your expected projections, including turnover and profit, for the next three years. Investors may wish to dig deeper to find out about your current assets, debt on the company, who else has money invested and how much equity you’ve given away.