Top 6 Tips For Pitching Your Business Ideas To Investors
Coming up with a business idea is the first step to creating a successful business. However, implementing the business idea is the most daunting step. During implementation, you will need enough startup capital to get the business off the ground. New startup owners rarely have enough capital to start a business. That’s why they pitch individual investors and banks to get funding for their businesses. However, a pitch can win you funding or fail to do so. It’s the purpose of this article to illuminate you on the smart tips for pitching your business ideas to investors or financial institutions.
Preparation for the pitch should go beyond your business ideas
Experts in the domain of investing say that when pitching your business idea to investors, you should not only focus on the idea but yourself as well. Investors these days invest in your image before they invest in your business plan. Therefore, it’s important that you present yourself well on that day to ensure the investor likes your image. Investors like people who are fast, efficient and thoughtful. They also want to know if you are resilient enough to sustain the business idea from its inauguration to growth phase.
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Focus on the essentials when presenting your business ideas to investors
If you ask angel investors, you’ll find out that they are more interested in the idea presentation than the business plan. So you should be able to explain your business idea, ROI, and growth strategy within 5 minutes. Remember that attention spans are way shorter these days, so if you can’t explain those in a shorter timescale, you’ll lose the chance to pique their interest.
Draw up a plan of your business ideas from the first day
Another thing that investors love to hear during any pitch is the exit strategy. Most investors lose interest after staying with business for over 5 years, and so, they keep an eye out for new opportunities. Therefore, during your pitch, you should be able to categorically explain your exit strategy. Does your exit strategy involve selling all of your shares to another entrepreneur? Are you going to go public with the business or offload it to a venture capitalist when exiting? Those are some of the questions you will have to explain to the investor.
Conduct rigorous research about the investor you’re going to pitch your business ideas to
Make sure to gather adequate information about the investor. Check out their history of investment and whether or not the businesses they have invested in have succeeded. Does the investor have experience and expertise in your industry? Will they dedicate enough time to your business idea? These are crucial aspects to determine upfront to ensure you’re dealing with the best investor.
Know that investors research on your business ideas before releasing any money
Typically, investors take about three months to research and evaluate your business ideas before they make their final decision. This is a long time, and if your business idea is rejected, it will be a complete waste of time on your side. So, make sure you’re not wasting your time and that of the investor by coming up with a compelling business idea.
Get to grips with the vocabulary in the niche when pitching your business ideas
When pitching your business idea, the investor will want to know if you have a grip on the domain. They will know by just listening to your vocabulary. If they find that you are using terms that are not commonplace in the investing industry, they will simply know that you’re an amateur and you may lose the funding.
Statistics show that just 25% of business ideas make it beyond the first phase. So make sure to follow these tips if you want your business idea to go all the way to the last phase. These days, it doesn’t matter which continent you are in, if your business idea is revolutionary, there will be no shortage of investors to fund your business.