I’m sure anyone who’s ever pitched a business plan has wondered what was running through the potential investors’ minds. Are they interested? Am I making any sense? What is the likelihood they will invest in my product or company? After hearing countless pitches—some great, some bad, some terrible— here are three interesting thoughts that many investors consider while listening to your business pitch.
Are You Capable?
Do you have what it takes not only to make a successful product but also to completely alter your product’s industry? Sure, you’re smart and credible, but investors want to know that, without a doubt, you’re going to put their money where your mouth is. They want to know if your network is well established, if you’re trustworthy, and if you’re willing to take educated risks. Believe it or not, investors are thinking about all these things within the first few moments of meeting you.
Do You Buy Your Own Pitch?
I know it sounds counterproductive, but do you actually think you’ll be successful? Investors want to know that you’re committed to your product and willing to go the extra mile to see it succeed. They want to know more than just what you plan to do once you get funding. Likewise, they want to know what actions you have taken thus far to ensure success so that their investment isn’t a waste of time and resources. Also, they want to know if you worked on a MVP – minimum viable product – which will allow you to see what customers think, and use that feedback to make the product better
Why Do You Even Need Money?
Investors want to know if their potential investment in you is “nice to have” or “need to have.” They don’t want to give you money if it’s only going to help you pay off your mortgage or pay your employees while they work. Instead, they want to invest so that you can meet customers’ demand or so you can better develop your product with technical innovation, all while getting a good return on their investment. Investors will definitely be listening to hear if their capital will raise your product to new heights. In addition, they will be comparing the potential investment in your company versus other opportunities that they have to invest in. So remember, make sure you are 110% prepared to convince them of why they need to invest in your company instead of any other opportunity they may see.
Think about these three points when creating your pitch so you can get the financial backing your product needs. Like what your read? Tweet @StarterNoise letting us know what you think using #thinkbeforeyoupitch.
Derek Rundell, is a successful business leader, operator, and serial entrepreneur. Derek has founded, managed and sold businesses in the technology, media and finance industries. He sits on several boards and serves as an advisor/investor to numerous established businesses and startups. Startups are Derek’s real passion, and in addition to building his own portfolio of technology, media and financial ventures, he invests in and mentors startups and entrepreneurs. He is passionate about sharing his knowledge and helping other businesses succeed.