About half of all the companies I do work for, or work with, are early stage start-ups, particularly in the agritech, bioscience, technology, specialist manufacturing, aerospace or clean/greentech sectors. Many of these seek funding either through an investor, or a grant. In both of these cases, they are required to formulate a pitch and deliver it. Typically if a company approaches me before they pitch, I will assist them in the formulation and delivery aspects, so they are better polished.
Recently the Los Angeles area was abuzz (as it will again soon with TechWeek) with events around the Innovate Pasadena and Innovation Week in Los Angeles events – with loads of networking and pitching opportunities for young companies. It created a lot of energy within the start-up community, and mingling with investors, influencers and other innovators gave untold opportunity and direction to start-up decision makers.
During the events I was approached by several companies to assist them in their endeavors to get funding. I also approached others I saw during their pitch presentations, where I saw they needed some help in getting a better presentation and slide deck.
By any measurement, getting in front of investors is a great thing and a success that should be celebrated. However, if you’re doing multiple presentations a week and you’re measuring your success in volume of investors you’ve pitched to, there may be a disconnect. “We’ve pitched to six investors this week alone, and have averaged about 3 per week for the last three months” was a typical story. It’s awesome, sure, but have you landed a deal? Have you been asked back? Have these investors even called or emailed and asked for additional information? In all these cases the answer was a resounding, no. If the net effect of pitching is to score an investment deal, then clearly something isn’t happening. There are no brownie points for accumulating the most numbers of investor pitches.
If you haven’t gotten past the pitch, one of the following may be happening:
1. Are you asking the right investor? “Horses for courses” the saying goes, and so it is for investors. Merely getting in front of any investor just to deliver a pitch is not the way to find investment. Further, be discerning: find an investor that is going to work well with you.
2. Have you asked for the right amount? Should I ask for a lot, or ask for small amounts? I suggest looking at your needs and working backwards. Even better if you can elaborate the purpose you will be using the investment for, and the speed with which you will grow, the scale and overall performance based on clear goals and benchmarks.
3. Have you listened to the feedback given to you? Listen to the advice given by the last investors you pitched to, and make the appropriate changes to your presentation. It may be obvious and sage advice, but take the advice, talk it over with the team and your consultants, and make the changes you need to re-pitch.
4. Are you ‘ready’? This may seem like a no-brainer, but many companies, while they have a good technology and it has emerged from the lab with a good solid foundational IP around it, may not be in a stage to be ‘investor ready’. There may be something missing: management team, aspects of market research not accounted for, gaps in customer validation or a weak competitor profile. These need to be sorted through, and only a mature enough company will know the difference. If in doubt, ask.
5. How strong is your business case? Unfortunately, market opportunity does not always translate into market potential, and how you explain how you will raise money, and sustain that, is just about the most important piece you will need, to grab the attention of a potential investor, in your company.
6. Have you sorted through your ‘housekeeping’ issues? The right IP regime, the right go-to-market strategy, the right kind of business structure and even the team you have assembled, can all make a difference to the relative strength of a pitch and successful presentation. Anticipate: Be ready and able to answer any and all investor questions.
7. Have you raised what is important to investors in your pitch? Finding out what is important and salient to the interests of an investor is part of the capture. Articulating it with the kind of economy and brevity of language you have in 15 minutes can be difficult, but overcome. If an investor wants to find out how much money you have, or how many current sales, don’t dance around it, tell them the truth.
Remember, you only have moments to get your pitch across (maybe 15 mins), and capturing investors from the start is key. Build on that capture throughout your presentation, so you hold them waiting for the next big thing in your presentation.