uKoot Story: Nail an Investor Down
January 16, 2013
Tech entrepreneurs often gather once a week in a cozy place to grab some coffee, free Wi-Fi, and chat about what’s new. One thing I have heard repeatedly is it is hard or impossible to pitch investors who barely know me. What are investors looking for in a pitch and how to secure “funding” from an investor that best fits my goal?
The book Applebees America, says that the basis of an effective conversation is to have a thorough understanding of the organization and the communications environment, including the audiences and other players. It is impossible to know whether an investor will be interested in my product. But I need to be fully prepared the key message for every email and presentations. Generally, business owners will open a window of 15 minutes for an initial pitch. Please remember don’t talk about how my product works. Try to tell my investors how I will make money with them if my product is actually working. In the meantime, the messages need to be clear and concise when I start communicating with the potential investor. Take a minute to think what I expect the investor to describe my business concept and progress to a partner in his or her firm.
Which tactics do I need for an initial pitch? Firstly, I will be armed with a comprehensive business plan with a well-defined marketing strategy and fancy tactics. It is a starter to stimulate the appetite of the investor. But in order to nail a deal down, I will use up my enthusiasm and passion to introduce the product. But don’t forget to focus on the Money.
Anticipate questions inventors might ask. How large is your market? Who are your competitors? Why is your product better than what is already in the market? What is your customer acquisition strategy? How much money have you made? Answer these with a cool, calm tongue. It is a platform to test the entrepreneur’s capabilities under high pressure.
A PowerPoint presentation using about 12 slides is standard, particularly with a tech product. Had better to show a demo to investors so they can see how it could actually work. If you can demonstrate your product or hand out product samples that’s a plus. Discuss actual sales or anticipated orders. Also, this is where your research on testing or proving your business concept comes into play, which includes results from surveys, focus groups, and product tests to show any customer insight you have gained.
Last but not the least, the more you pitch, the more you get a sense for what parts of your pitch resonate with investors. Keep the parts that work and ditch the parts that don’t. Keep iterating until you nail it.
