I attended the Funding Universe Live Pitch event here in Portland yesterday, and I found the whole process fascinating. There were 5 companies pitching, about 35 people in the audience, and a panel made up of experts with expertise in venture capital, angel investments, and more (including our favorite Portland tech blogger Rick Turoczy). It was a very fast paced format: 4 minutes to pitch, 3 minutes for Q&A, and 2 minutes for feedback from the panel.
Keep in mind that I am not an investment expert, but I wanted to pass along a few tips based on these 5 pitches and the questions / feedback from the panel of experts.
- Get to the point quickly. Granted these were 4 minute pitches, but you never really know how long any meeting with an investor will actually last. They may get pulled away for another reason, and if you didn’t make your key points quickly and early, you may not get to make them. In this case, a couple of these pitches were over before the presenter really got to the meat of the presentation.
- Tell them what you do first. One of the companies started the pitch with a very long story about a briefcase, which had several of us in the audience thinking that he was pitching a company that made briefcases here in Oregon. This left all of us confused and took up way too much of his precious time resulting in an incomplete pitch. The feedback from the panel was that you need to capture the attention of the audience in 30 sec with an elevator pitch that includes exactly what you do.
- Talk about your background. This is critical for the CEO, since the investors ultimately are investing in people as much as the business. Make sure that you provide an argument for why they should invest in you. Include information other key team members and advisors if you have the time.
- Know your competition intimately. You should be able to discuss details about your competition and be very clear about how you will position yourself against the competition. You are not unique, there is competition everywhere, and do not underestimate the importance of the competition.
- Be specific about revenue. Yes, you will need to make assumptions and probably a few guesses when putting together your revenue projections, but you still need to do a significant amount of market research and be specific about the revenue opportunity. Narrow it to a niche and dominate rather than claiming to have a very small percentage of an enormous market. Give examples of similar products, track them & use them as base for projections.
- Tell them exactly what you need and how they will benefit. Be specific about how much money you need from the investors, how you will use it, and how they will get their return on this investment.
- Practice, practice, practice. You need to know your pitch inside and out. You should not be spending time looking at the screen or reading the slides, which suggests that you aren’t comfortable with the material. Practice your pitch until you are completely confident about giving the presentation. If the computer malfunctions, you should be able to continue to make your points without the slides.
For those of you with more expertise in pitching to investors, I am curious what you think. What are your top tips for creating an awesome pitch?
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6 thoughts on “Tips for Pitching to Investors”
Excellent advice Dawn. I’d add one more suggestion: if it’s an investor pitch, don’t make it a product demo! (One of the presenters Monday fell into that trap, taking up almost all the time with a demo.) An investor wants to hear about the business opportunity, not just watch a product demo.
Excellent point! One of the panelists also suggested using visuals to help them understand how the technology fits together, which I think is part of the same point. They didn’t really want to know all of the technical details; they just needed to understand the big picture.
There’s a program on BBC Amercia I TiVo called Dragon’s Den
From your account it’s similar to the event you attended and as BBC America is a minority channel, the audience might well be similar too 🙂
The particular thing that comes up in that show is they really want to invest in a person and they often want to make sure that you have no other side projects on the go and the idea being pitched will get all of your time and effort.
Excellent takeaways Dawn. As one of the five presenters I can tell you that four minutes goes by in a heartbeat and forces you to really focus – which is, of course, intentional by the organizers. It is worth noting that VC’s see thousands of business ideas a year. You have to be focused and tight with your presentation to cut through all the noise and really catch their attention.
Another good resource on the topic of how to pitch is Guy Kawasaki. Guy suggests the 10/20/30 rule for a typical one hour VC pitch: 10 slides, 20 minutes, and 30 minutes of Q&A. His comments are well worth reading. http://blog.guykawasaki.com/2005/12/the_102030_rule.html
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