While many of the social messages you encounter scream “gold stars for everyone;” such is not the case where business is concerned. It is not enough to have a good idea anymore as the competition for investment dollars has become fierce. A successful pitch to investors requires the clear communication of your plan for revenue growth.
So, let’s dive into the 7 key elements of a pitch to increase your chance for investment:
- The Intro -quickly communicate who you are, the name of the business, and the Value Proposition of your offering. For help crafting your Value Proposition, this previous blog post should help; just be sure to clarify how you are set apart from your competition.
- Deliver The Offering -drive home to benefits of your product or service, with the support of visuals and a high level overview of the features that differentiate it from similar options on the market.
- The Buyer -give a thorough look into the persona of the end user who will part with their money to get their hands on your offering. Be sure to speak to both the demographics (gender, pronouns, age, education, income, etc.)and psychographics (attitudes, aspirations, influences, etc.)of the consumer.
- The Terrain -discuss your industry, with a focus on the niche you plan to carve out for your business. Also walk them through your SWOT Analysis of the top 3 competitors. I suggest that Industry and Competitive Analysis be two separate slides.
- The Business -provide a glimpse into your business model, and a thorough look at your Go To Market strategy. Be sure to include your COGS, pricing strategy, sales process, marketing goals, sales cycle, and client acquisition cost.
- People Power -share the brief bio’s of your leadership team. Communicate it to clarify how each person can help achieve your goals/ projections.
- The Numbers -what revenue do you realistically believe you can generate, and what do you expect it to cost in order for you to do it well. This is the big supporter of your ask; you want to show where the investment you are pursuing will be spent on the growth and success of your venture.
Have you ever wondered what Mark Cuban is doing on his notepad when people pitch on Shark Tank? Smart money says that he is calculating the ROI if he were to invest.
The national average IRR (Internal Rate of Return) that venture capitalists seek is 22-25%. Now having a glimpse into what the people you are pitching care about, I suggest working with your accountant to determine if your projections hit/ exceed the mark. If not, don’t fudge the numbers, just think bigger.
Here’s to your success; get to work! -Rich Laster
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