The competition is tough. Figures from trade body StartUp Britain show almost 658,000 new companies launched in 2016, up from 440,600 five years earlier. So you’ll have to think hard about your fundraising story – a concise summary of what is exciting about your business to an investor – before any potential meetings.
Sam Myers, a principal at venture firm Balderton Capital, says: “This will be some combination of what is happening in the market they’re in, why they’re at the heart of this important trend… All other content in a pitch should relate back to this fundamental story or investment thesis.”
You need to capture investors’ attention and make them eager to learn more, he says. “If the most exciting part of your fundraising story is how fast you’re growing, then make sure you show that graph early on. If you’re an early-stage company with an impressive founding team and strong first hires, make sure you show the team slide upfront.”
Put your growth prospects at the centre of your presentation, which must be “simple and significant”, says Sara Gordon, Creative Director at online florist Bloom & Wild. Founded in 2013, Bloom & Wild showed a team of investors its impressive growth rate of 35% per month and secured £3.75 million in early 2017.
You need to show investors you’re solving a true customer need: Bloom & Wild’s bouquets are designed to fit through a standard letterbox. Gordon says: “I’d explain the problem you’re solving, and give the investor a narrative they can relate to. I’d also share some high-level numbers on current and projected growth, as well as how you’re acquiring and retaining quality customers as you scale and build the brand. Acquisition and retention are both important.”
It may sound old-fashioned in today’s digital world, but bringing handouts to the presentation helps. The people you want to impress are more likely to remember you if you give them something to take away, says Joanna Hill, interim Chief Executive at The Start Up Loans Company. “It looks professional, no matter how small the idea or how new the business is.”
Get the better of your nerves on presentation day by practising plenty beforehand. Hill says: “Try out your pitch in front of your family and friends and repeat your USPs [unique selling points] over and over when you have spare time, such as when you’re travelling.”
Try out your pitch in front of your family and friends and repeat your USPs [unique selling points] over and over when you have spare time, such as when you’re travelling.
Joanna Hill, The Start Up Loans Company
It’s vital the whole team brings energy to the table to project the right image.
Graphite Capital meets with hundreds of businesses each year, says Omar Kayat, a partner at the private equity firm. The worst ones have the lowest energy levels.
“They should be engaging, answering questions directly and succinctly, while encouraging other members of the team to contribute,” he says. “Being on top of the financials is a must and the team need to demonstrate a clearly articulated and realistic growth plan, acknowledging the areas where they may need some help.”
Private equity firms typically want businesses to double in size in five years – so how would you take your company to the next level with a £100 million investment? Find the balance between an exciting plan and a realistic one.
As an established business, banks may be happy to lend to you. Lenders home in on credit risk – resilience, cash generation and covenants – to ensure the business can survive tough times. Will Brexit affect your company? Be prepared to explain how your business can withstand a downward dip, as lenders will model a number of stressed scenarios to ensure it can satisfy loan obligations.
Informed Funding events are exclusive to Workspace Customers and help businesses learn about all aspects of funding, but also provide invaluable networking opportunites.
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