Your pitch to an angel investor is your big chance to secure vital funding for your enterprise. You might have a solid business idea with a real chance of making money for you and your backers, but if you can't convince people to put their faith in you and
With that in mind, here are some tips to remember when pitching your business plan to potential investors:
1. **Don’t forget the details**. Every businessperson knows the importance of an “elevator pitch” – a short summary of your idea and its potential benefits. But that’s just a starting point. If you want an investor to get on board, you need show you can take care of the details. Do your homework and don’t make sloppy assumptions – back up your claims with accurate figures wherever possible.
2. **Show you have the key skills**. If your business relies on certain skills and capabilities, it helps if you can show you have them available within the business itself. An investor will be nervous if your plan relies on outsourcing for the key component of the enterprise.
3. **Be realistic**. Although you’re trying to convince an investor that your business has a bright future, they will see through any attempts to paint an overoptimistic picture. Your growth projections must be realistic. And don’t overvalue your company. You will irritate investors if you can’t back up your optimism with evidence.
4. **Think about the investor**. You can be so intent on making your own dreams come true for the business that you forget anyone backing your enterprise will want a return on their investment, too. Focus for your pitch on the benefits to the investor rather than the wealth it will create for you. With that in mind, don’t build a big salary for yourself into the plan, or the investor will get the impression they’re expected to part with their funds to fatten your wallet rather than feed a growing business.
5. **Remember the importance of sales**. You might have a really clever idea to show off but that won’t win you an investment on its own. You have to show there is a real market potential for your product or service. So emphasise the sales potential of your idea rather than how ingenious it is.
6. **Show you’re willing to graft**. Don’t expect to get the backing of an investor unless you’re prepared to put all your efforts into making the business succeed. Forget about a normal nine-to-five working life – you need to be available 24/7. Having an unconnected business interest or a regular day job will ring alarm bells for investors. They’ll either think you’re not confident in your idea or won’t be able to give it enough attention.
7. **Don’t rely too much on marketing**. Your business plan needs to show there are enough customers out there to make your idea profitable. But you can’t use marketing as a magic wand to conjure sales. You need evidence to show consumers are willing to buy your product or service; an investor will not be satisfied with a big marketing budget in its place.
8. **Do your research**. With the above in mind, research the marketplace and gather evidence to show the potential of your business plan. Look at the sales figures in your industry and point to gaps in the market you can fill. Also consider setting up a focus group and using the positive findings for your pitch.
9. **Practise your pitch**. Your future depends on delivering a good pitch. So don’t blow it by going in underprepared. Go through as many dry runs as it takes to perfect your delivery. Try to anticipate the questions you’ll be asked but also be aware you might not have the answer to everything – in which case, admit you don’t know rather than trying to wing it.
10. **Stay calm and polite**. You’re bound to be nervous but try your best to keep your cool. And although you have an emotional investment in your business, don’t take criticism to heart and react badly – stay professional.