Entrepreneurs

5 Ways To Nail Your Investor Pitch As VC Rounds Dwindle

If you’re planning on launching a startup anytime soon, you’ll be doing so in the middle of some significant economic headwinds. 

Even if you have a great idea, a solid business plan, and a willing market all lined up, there’s no guarantee that you’ll find investors. 

A recent look at Crunchbase’s venture capital data shows that VC activity is down across the board, with a 44% overall decrease in startup funding rounds in the US so far in 2020. That means you’ll have about half as many chances to secure funding as you would under normal circumstances.

None of this means you have to shelve your startup funding plans. It just means you’ll have to work twice as hard to make sure every pitch meeting you line up gives you the best possible chance to get to yes. Here are five ways to make it happen.

1. Tell an engaging story

The first thing you’ll have to remember is that the people you’re pitching to have heard and seen it all before. Entrepreneurs show up at VC pitch meetings armed with facts and figures aimed at making their case as a solid investment. You’ll want to do all of that, but don’t stop there. What’s most important is to make sure your presentation tells an engaging story about what your startup plans to do and why the investors should care.

For that reason, you should build your presentation by constructing a solid narrative first. Don’t begin by assembling data and creating a number-heavy set of slides. Doing that will risk losing an investors interest before they have a chance to learn what your startups goals are. For example, the team at ClickUp, which just raised $ 35 million, focused on telling a story on the shortcomings in the project management space and the need for integrated solutions.

Get investors to understand how you identified a problem and the issues your potential customer face. You can easily find designers now to create illustrations that emotionally bring your story to life. 

Once you outline a compelling story, you can support your presentation with facts and figures, like the potential market opportunity for your business. Startup coach Dave Bailey offers an excellent writeup on pitch narrative construction that makes an excellent guide to get you started.

2. Know who you’re talking to

Each investor meeting you have will be unique. Knowing a little bit about your audience first can help you tailor your presentation for maximum effect. Make an effort to research the backgrounds of the people you’ll be presenting to before you go. What past companies and industries have they previously invested in? Are there any tie ins to your business?

Sometimes, an investor’s LinkedIn or Twitter profile can tip you off to what their interests are. For example, you can read articles they post and bring up those topics to help develop a stronger connection.

If you can’t find any information beforehand, make a point to start your presentation by letting the investor tell you a little about themselves. Then use what you’ve learned to make adjustments to your presentation on the fly. 

If improvisation isn’t your strong suit, practice beforehand. PowerPoint Karaoke offers ready-made presentations you can use to hone your skills by narrating them.

3. Standout and provide additional information

You might think your preparation work is over when your pitch deck is complete. 

To stand out though, prepare useful supplementary information that allows an investor to dig into your business and market opportunity further. You can share more information on competitors and details on marketing sizing that would have been too in the weeds for the actual presentation.

Tools like FlippingBook can help you create a polished and professional digital handout that can be personalized for each investor and can continue to tell your story in a compelling fashion. These tools also allow you to track who’s looking at your materials after the meeting is over, giving you insights on who engaged investors might be. 

While an investor may not necessarily read additional material, it still shows that you’re thoughtful and better prepared than others, helping you sell investors on why they should invest in you.

4. Make the first five minutes count

First impressions matter. While you should be well prepared, make sure you practice until the first five minutes of your presentation are flawless. This is your small window to really hook your audience. To do that, make sure you tell a story that: 

  • Explains the opportunity. Highlight the market conditions, innovations, or consumer problems that make your idea possible or necessary.
  • Showcases your solution. Provide a compelling reason why your idea can take advantage of the opportunity, and important traction to date that can give the investor confidence you’re on the right track.

If the information you provide in the first five minutes doesn’t make the investor want to learn more, it doesn’t matter how captivating the rest of your pitch is. Once they’ve dismissed your idea, it’s hard to gain interest.

5. Be humble and confident

Lastly, you’re going to have to let go of the idea that you can prepare for anything. Even if you study the most common questions potential investors might ask, it’s likely investors are going to ask questions you don’t have answers for. 

What’s most important is to project confidence. If you don’t know the answer to something, be honest. Don’t be afraid to admit it. Just be sure to assure the questioner that you’ll make a good-faith attempt to find the answers they seek and to follow up on the question. This shows that you’re coachable and dependable, characteristics that investors want to see.

Pitch perfect

While these tips will help you put your best foot forward, nothing is more important than consistently pitching your idea and iterating on your presentation. The more you present, the better you can hone your story and presentation. If you think of every rejection as an opportunity to learn, your pitch will only become better and better.

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Forbes – Entrepreneurs

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