A few years back, I came across a successful entrepreneur who had launched his company with no outside financing, and over time had generated impressive annual growth of over 100 percent: He had spotted a niche opportunity in a growing market, made a number of smart strategic moves early on, and built a company that was consistently expanding profits. Why was he coming to me? Because, despite this success, the owner was remarkably incapable of articulating, in a concise, coherent fashion, precisely what and how his company did what it did.

This entrepreneur's business presentations were, literally, all over the map. He randomly hopped from one idea to another, ignored the big issues in favor of the details, and inadvertently erected a barrier between himself and those around him. It wasn't that he didn't understand his business. When I asked him a specific question, he would answer it thoughtfully and intelligently, but he failed to provide a big-picture overview of his strategy. His presentation to our investment committee was painfully confusing and somewhat tedious.

It may surprise you to hear that we invested in the entrepreneur's company anyway. In the end, it was simply too good of a business to ignore. And that, in a nutshell, is the most important thing to remember about making a presentation to potential investors.

If you have a great business model, consistent profits, and a significant market opportunity, the rest will often take care of itself. In fact, you may not even need an elaborate business plan or pitch book to close a deal.

Focus on Opportunity, Performance and Experience

While there's no single way to present your company to investors, there are three specific types of information that yield enough for me when evaluating a potential company:

The first is market opportunity. How big is the market for the product or service you provide? How fast is it growing? Does your firm have a sustainable advantage over its competitors?

Why is market opportunity so important to me? Because if your answer is, "I'm in a tiny market," then the reality is you can't expand. Even if you have a strong product and management team, investors will stay away, knowing that they can't sufficiently increase the value of your company to make their investment worthwhile. However, if your answer is, "This is a huge market," "This is a fragmented market ripe for consolidation," or "This is a market in turmoil, due to changing regulations or competitive structure," investors will be interested to know how you propose to compete.

Your company performance is the second key element. At my firm, we focus heavily on financial performance, using revenues and earnings as a proxy for many other measures of corporate success. If sales, revenues, and profits are increasing, we can logically assume that you have a good business model with room for further growth.

The third area we'll evaluate is your management team. Ideally, we look for senior members of your firm who have experience in running businesses, particularly in your company's market or a related one. At the same time, we assess qualitative factors, such as trust, intelligence, integrity, and commitment.

Designing a Plan for Growth

I also look for a solid business plan -- not so much a written document as a strategic vision for growth. You should be able to answer questions like: Given the market opportunity and your management team, how do you expect to achieve your goals? Let's say that over the next 12 months, you are projecting growth from $20 million to $40 million. I'd want to know whether the market is big enough to support that kind of growth. What is your company's current share of the market? To increase this share, how do you plan to take business away from your competitors? How many employees will your company need to hire in order to support its growing business? What changes in product-line or distribution strategy will be necessary to take your business to the next level? What other resources do you need to achieve these goals? If you don't have reasonable, thoughtful answers to questions such as these, the transaction is unlikely to go forward.

An Attractive Business Is a Scarce Commodity

As they compete for capital in the marketplace, entrepreneurs naturally worry about perfecting their pitch to investors. However, to me -- and to most seasoned investors -- a good business model is far more important than an attractive presentation. If you concentrate on understanding your market opportunity, competitive advantage, and plan for growth, the pitch book will take care of itself. A good business is worth a thousand PowerPoint slides.