You finally have your chance to pitch some investors. Your business concept may be solid. But are you aware that there are at least 25 otherways you might shoot yourself in the foot? Avoid them all with this checklist, segmented into three sections from easiest to hardest.
Managing Your Audience
There is some basic legwork required before you show up to pitch. It is not hard, it is just work to complete before you walk into the room:
- Make sure you have a copy of the presentation guidelines, preferences and investor customs of the group you are pitching. Make sure to respect and follow them.
- Do some research and networking to make sure there is at least one, if not several, fans or "champions" in the room. Champions can lend you their credibility and bail you out during the post-pitch discussions.
- Review the preferences and portfolios of the investors--target your pitch accordingly. If there is no fit at all, spare yourself the bother.
- Don't ask investors to sign a Non-Disclosure Agreement (NDA)--investors don't sign NDAs and they are not interested in stealing your great business idea. For truly sensitive patentable information, file a provisional patent application before raising money.
Managing Your Material
Unsuspecting entrepreneurs often make rookie mistakes with their material. Preparation and polish is all that is required.
- Never stand up to pitch an investor if you cannot crisply explain what your company does in less than 25 words and state your value proposition in less than 50 (Here are some tips on packing that value prop into a moving elevator pitch).
- Build a tight, clean deck -- don't use more than a handful or words on any one slide, don't use small font sizes, forget to label your axes, or use huge tables of numbers.
- Avoid elaborate slide builds or animations that make it impossible to go backwards or ad-lib. Plus, complicated slideshow features can be buggy and introduce embarrassing glitches that throw you off balance.
- Don't jump right into the middle--set some ground work to engage your listener with your story.
- Do not rely on a complicated demo or video as part of your pitch--a simple demo or screenshot is all you have time for.
- If you don't know the answer to a question, don't guess, unless you say you are guessing, and you explain the basis for your guess.
- Don't over-promise or make super-human claims. Focus on what you are pretty sure you can do, not what you think you maybe you can do. Investors can smell B.S. a mile away.
- Don't bring a massive, overly long slide deck--boil it down like maple syrup, to the 10-15 key slides and throw the rest into an appendix.
- Don't present numbers that you have not sanity-checked with both a bottoms-up and a top-down analysis. Benchmarks are your friend--use them. Hate to break it to you, but you are unlikely to have revenue of $10M per employee.
- Avoid presenting numbers you cannot account for or explain how you arrived at. Even if you are not the numbers person on your team, you need to understand them all.
Often the person doing the pitch is her own worst enemy. Even if your deck is great, and the underlying story is compelling, it is easy to mess up the delivery.
- Even if you are worried about time, don't nervously rush through your early slides. It is essential to build your story on a foundation and let people acclimate to you and your idea. If you lose them early on, you will never get them back.
- Don't go in unpracticed, relying on notes or index cards, or simply reading your slides. Failing to practice is not a perception you want to create.
- Don't run over your allotted time (nor should you mess up your team choreography).
- Listen carefully to the full question, and answer what is actually being asked. Repeat it if necessary to ensure you got it right.
- A sense of humor is great, but avoid being flip, cocky or glib in your presentation. Sorry, but these people don't know you well enough to get your sense of humor.
- Never preface an answer with the reminder that "you are not a business person."
- Don't mumble, whisper or equivocate; it is essential to project your voice powerfully and to be strong and confident (practice until you at least appear strong and confident).
- Body language matters: smile and show some passion for what you are doing.
- In particular, don't forget to smile while a question is being asked and consider adopting the habit of saying "that's a good question" on the tough ones.
- Don't be offended or take a persistent line of questions personally. It is your fault if they don't understand what you are trying to say.
- Don't rebut or argue with questions. The point is not to prove them wrong, it is to educate them on your opportunity. You win by educating them to your view.
Pitching is hard to master. It requires some practice. But if you take the time to do some prep work by mastering the list above, you can avoid including basic mistakes into the mix.
Christopher Mirabile (@cmirabile) is the Chair of the Angel Capital Association and an early stage investor in Boston MA, USA. He is the co-Managing Director of Launchpad Venture Group and the co-Founder of angel portfolio management tool www.Seraf-Investor.com.