In this Article...quick links
- When pitching to investors: first, second and third impressions count
- Introducing yourself when pitching to investors
- Pitch quickly when pitching to investors with an elevator pitch
- How to do a full-blown pitch presentation when pitching to investors
- Improve your pitching to investors with our Pitch To Win training programme
If you’ve just secured that all-important funding meeting but are now in a mild state of panic because you are soon to be pitching to investors, then relax, give yourself some slack – it’s likely you’ve already done a lot of the hard work – had a great idea; set up a business; secured at least some finance; hired staff; had positive publicity; made your 100th sale; hit £1Million in turnover. Or a combination of these, or even some greater achievements, or simply just the first one! So, well done!
Now we’ll help you with the next phase – pitching to investors.
There are different scales of meeting where people are pitching to investors – from the small scale and informal e.g. appealing to family members for an initial loan, or an investment, right up to the large scale and formal e.g. Series A capital raising, or even an IPO (Initial Public Offering). But in a sense, the same principles apply. Whatever stage your business is at, whatever scale your funding meeting, at the end of the day it’s simply a pitch for financial participation.
We’re going to imagine, that for this post, you are looking more towards larger-scale funding, and as such will be presenting at a more formal meeting. But don’t let this stop you from embracing the principles we’ll share here even if your ambitions are smaller scale and you’re pitching to your family for £1,000 to help with your first ever business.
When pitching to investors: first, second and third impressions count
First, you need to make an impression (the right impression) on your audience. To do this you need to know who they are. Inside out! This is the first thing you should know about pitching to investors.
Basics are important in understanding your audience. Like, what is the firm’s background? Who have they invested in previously, who currently? How much do they already know?
So, too, are specifics. Who will be in your audience? Who are the key players? Have you anything in common (people buy from people they like, know, trust)? Do they have a ‘process’? How much detail do they want? What are they looking for – to fill a gap in their portfolio; to get in, and get out fast; to be with you for the longer term? What objections might they have?
The key here is: seek first to understand them, if you want them to understand you!
Quick tip – you should probably spend more time on this than you do creating your presentation itself.
p.s. Don’t forget housekeeping factors too, like how much time do they have?
Second, you need to make an impression through your pitch – by standing out from all the other pitches your potential investors see (they only have limited funds and will want to pick the investment they feel most confident in and ‘impressed’ by).
To put this into perspective, the number of pitch documents professional investor firms receive a year can typically be anywhere from 500 (for an average ‘Angel’ investment group) to 2,000 (for a mid-sized VC group).
An average of around 200 to 300 of them convert into meetings – that’s about ONE A DAY. That’s a lot! So clearly, you need to stand out.
But it gets even more serious when you find out that investors are commonly thought to back around just 1% of the pitches they receive. So, to be picked, you must pitch to win.
Make the best impression, by giving your prospective investors the maximum confidence in you through your pitch, and in doing so you’ll stand out from the 99%.
And last, but not least on impressions…
Thirdly, you need to make an impression with your product/service/solution. Of course, as well as making a great impression through your rapport with the audience, and your pitching skills themselves (will they like you, do you sound confident, prepared, driven, knowledgeable), the most important thing to do is to make an impression with what you’re pitching about (your proposition/offer of a new product/service/solution), so it stands head and shoulders above your competitors, makes a very strong business case and gains buy-in from your investor audience.
OK, let’s, for a moment, go back to first impressions. They count. So let’s talk about how to introduce yourself to your investors.
Introducing yourself when pitching to investors
Your initial contact with the investor is likely to have been via email, phone or video-conference (perhaps by introduction from a third party), so it’s probable that when you present your pitch it’ll be the first time you will have met face-to-face.
You need to build rapport on a personal level right from the moment you meet. Greet people and try and ask a few questions, in a conversational manner, both to try and find common ground and to ascertain people’s level of knowledge and expectation before you begin (if you’ve done your research you should know a hot button or two which might stimulate some friendly chat).
Don’t introduce yourself by running through your career background. That’s boring. And generally, way too formal. Don’t go ‘off piste’ too far either, stay ‘on message’. It’s a balance, not too formal, not too informal. Be interested, and interesting (also, be personable i.e. use their name, and smile!).
What is hugely important, even critical, is to get across your passion – about your idea, your team, your sector. Passion is contagious…and positive! Investors will notice. Why? Because you can’t fake passion! Being passionate will set you up for success.
And perhaps the most crucial thing? Be yourself! You’re not just selling an idea; you’re selling you (as we’ve said already, people buy from people they like, know and trust – so be genuine and sincere – if you’re coming across as misleading, deceptive, disingenuous or insincere, it will show).
According to Jenny Tooth of UKBAA (UK Business Angels Association) “personal involvement is key – we’re investing in a person, that’s the main thing. Our confidence in you and your team. The personal bit of that is fundamental.”
Alistair Brew of BGF concurs “We need to like them and they need to like us and there has to be some sort of catalyst, some sort of reason as to why an investment actually occurs.’ So don’t underestimate the personal and personality aspects of the pitch, it’s not just about the business idea.”
Right, now you should know what you need to do to impress, and also how to introduce yourself when pitching to investors. So, it’s time to know what to say.
First quickly, with your ‘elevator pitch’, then in a full-blown pitch presentation situation.
Pitch quickly when pitching to investors with an elevator pitch
An elevator pitch can take anywhere from literally 10 seconds (generally impromptu situations, like when you’re caught in the proverbial elevator) to 10 minutes (this is much longer than it sounds; plenty of time to sell a dream or to turn someone off; be prepared for them to be distracted as this will still likely not be a planned event!).
Shorter is better. People (investors) don’t understand, or buy, complexity. Complexity takes time. Time is money. Investors don’t have time. They’re trying to make money! If you can’t explain your solution simply and quickly you better think again. If you can, do it in three sentences:
- Lead with the need: For example, Airbnb honed in on what travellers were searching for, but couldn’t find. They wanted affordable accommodation while immersing themselves in the culture of the place they were visiting.
- Sell the solution: Airbnb’s solution was clear: Develop a platform to bring travellers and spare room owning locals together.
- End with a result: With Airbnb, travellers would be able to save money on accommodation and homeowners could earn extra money hosting the travellers while offering insider knowledge about their home town. A win-win.
Remember, the purpose of an elevator pitch isn’t to get funding then and there, the goal is to get a follow-up meeting. And that’s where we’re going to now.
How to do a full-blown pitch presentation when pitching to investors
Before you are invited to a formal pitch presentation it’s very likely you’ll have had an elevator pitch plus been asked to send over a ‘pitch deck’. Although we are concentrating on a face-to-face, or virtual/online, pitch presentation in this article, much of what we’re recommending is also relevant for your initial ‘blind’ pitch deck (the deck you send over to your would-be investors prior to your meeting). The main area of difference will be that your presentation pitch deck will be MUCH less detailed than your ‘blind’ pitch deck.
So, here goes…
Keep it short.
And keep it simple. Just because it’s now a more formal, full-on pitch meeting, it’s not an excuse to throw everything including the kitchen sink at it. We call this ‘showing up, and throwing up’. Some call it a stream of consciousness. Or a brain dump.
Every presentation, including a pitch presentation (probably even more so), is for the audience. It’s not about you and everything you know. You need to give your audience what THEY want.
Quick tip from experience: even though we’re in the business of ‘presentation training’ and love talking presenting all day long, we can tell you that everyone wants every presentation they see to be shorter!
Even if you have a 1-hour slot, you should aim to present for just 20 minutes maximum and leave the rest of the time for Q and A’s.
Don’t save the best to last.
There’s a reason why every newspaper story has a headline. It works as a format. It summarises the content of the article and draws you in, giving you a taster, a teaser, a sense, or an idea of what’s to come. A pitch presentation should be no different. Share a headline with your audience.
Peter Coughter, in The Art of the Pitch: Persuasion and Presentation Skills that Win Business puts it like this: “The secret to selling great work is to sell the idea of the work before you sell the work.”
Use a structure.
Give your presentation a structure so it takes your audience on a journey. Roadmap it so your audience can follow it. Split it into sections, or chapters, to chunk your points of interest. And be sure to add in points of persuasion to drive your message home. Finish with a passionate conclusion to make your audience feel informed, confident and motivated to invest.
Cover, in some way, the following:
- The problem you’re solving
- Your value proposition
- Your competitors
- Your ideal customer and target market
- Your short, medium, longer-term business plan
- Your existing sales and customers
- Your marketing strategy/plan
- Your team
- Your financial data
- How you’ll use the funds
Tell a story.
Storytelling in presentations is all the rage, and for good reason. A story combines the three modes of persuasion, or elements of the classical rhetorical triangle to convince the audience through:
- Ethos – the presenter’s credibility
- Pathos – an appeal to emotion
- Logos – an appeal to logic
So, rather than just delivering the facts to your investors, try to weave a personal need or story into the narrative to make it personal, meaningful, original.
If we go back to the Airbnb example their story could have begun with: ‘You know, in all the years I have travelled abroad on business I don’t think I’ve ever really truly experienced the local culture of the country or its people.’
Limit your slides.
If you’re presenting with a slide deck, try to use no more that 10 – 12 slides (with one clear thought per slide) to communicate your idea.
Think of each slide as an asset. If you have 10 slides and are you are trying to raise £1m then think of each slide as being worth £100,000. Does that help to focus the mind!
Tip: make sure you can confidently navigate your way around the deck (including any data heavy appendix – see more on this below). That way you can easily access information during the Q and A session to support your idea.
Show THEM the money.
You received the invitation to pitch to potential investors not because they want to give you money, but because they want you to make them money. That’s it. End of story. So, you have to be very clear, and illustrate in as much detail as possible, what your revenue model is and how this will deliver solid, or spectacular (but not too spectacular, as you’ll likely be seen as naive), return on investment for your investors.
Do understand the absolute detail of your financial assumptions. You will be questioned on them!
DON’T be unrealistic with projections/forecasts or valuations!
Detail what investment you are looking for, what you are going to give in return and how you intend to use the funds to be invested.
Make your audience care about your idea like you do. Show your passion and demonstrate your enthusiasm. Use facts, power words and inspirational language (verbally, and on your slides) to bring them along on the presentation journey, or story.
Use an appendix. But don’t present it!
Confine all the drier detail in a slide appendix, or printed leave behind. Don’t ‘show up and throw up’ and present every single detail. You might be interested. Your audience won’t be. So put the details, including in-depth content about the following, ‘at the back’:
- Your team / experience
- The competition
- Your competitive advantage
- Target demographics
- Outline business plan
- Risks and how you’re mitigating them
- Revenue model and forecast financials
- Funding needs and why it’s a good investment
- Next steps
- Contact information
Ask for questions.
Questions are a good thing. Questions show interest. Imagine how you’d feel if you made your pitch and no one asked any questions! Not great, I’d say.
We’ve already suggested you leave two-thirds of your presentation to Q&As.
Don’t be defensive in your answers.
Address the risk questions (every business has risks).
If you need to, take a pause, and reset before you answer the question.
And, if you’re clever, you’ll anticipate questions before your pitch, so you can answer them in your pitch. Even prepare for them – ask someone to interrogate you after taking them through a dry run rehearsal. How you handle questions during your presentation will be as important as your presentation itself.
And ask questions yourself.
But, don’t ask for money, ask for advice! There’s an old adage, neatly summed up in the song “Feel This Moment” (2012), by Pitbull and featuring Christina Aguilera: “Ask for money, and get advice. Ask for advice, get money twice.”
The point is, you’re in a room full of experts (your investors more than likely will have experience in the sector you’re operating in), and their advice is probably ‘expert’ and free (at this point in time). Ask these experts questions. It shows you’re passionate. You’ll do what it takes to succeed. You want to listen. And learn. You want to improve, to make your proposition even better. And so make your investors even richer!
And finally, seek feedback.
When you follow up, ask for feedback. It’s important to think about what went well during the presentation, what didn’t, and whether there were any questions that you hadn’t prepared for.
You may not be successful at the first go, so learning from your experience and honing your pitch for the future is crucial.
Improve your pitching to investors with our Pitch To Win training programme
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Written By Belinda Huckle
Co-Founder & Managing DirectorRead Bio
Belinda is the Co-Founder and Managing Director of SecondNature International. With a determination to drive a paradigm shift in the delivery of presentation skills training both In-Person and Online, she is a strong advocate of a more personal and sustainable presentation skills training methodology.
Belinda believes that people don’t have to change who they are to be the presenter they want to be. So she developed a coaching approach that harnesses people’s unique personality to build their own authentic presentation style and personal brand.
She has helped to transform the presentation skills of people around the world in an A-Z of organisations including Amazon, BBC, Brother, BT, CocaCola, DHL, EE, ESRI, IpsosMORI, Heineken, MARS Inc., Moody’s, Moonpig, Nationwide, Pfizer, Publicis Groupe, Roche, Savills, Triumph and Walmart – to name just a few.