When it's time to pitch to investors, entrepreneurs should hope they're the first to meet with those investors that day. Unfortunately, all too often the investors have heard many pitches before you walk in the door, making it more challenging for you to spark their interest.
Or so says one of the stars of the hit TV show Shark Tank, investor Robert Herjavec. He says he often spends long days listening to pitch after pitch. Over time, the investors on the show can begin to "fade" and only the best pitches can get through. While most entrepreneurs are pitching investors in an office building rather than on a film set, Herjavec's point still applies. Most investors are extremely busy and by the time a pitch starts, it is part of an already long, stressful day.
I had the privilege of speaking with Herjavec at the recent Intuit Quickbooks Connect Conference in San Jose this week. Not only is he part of an Emmy award-winning TV show, but he is a respected businessman, heading up Canada's largest IT security provider. Herjavec offered his insights on capturing and keeping an investor's interest during a pitch meeting.
Start Off Strong
"If you don't get our attention, if you don't sell us on you at the beginning, it doesn't really matter what happens afterwards," Herjavec says. "I don't think there's ever been an investment where we're like, 'Man, hate that person. Really boring person. Well let's give them money.' That's the first thing we look at."
While an entrepreneur's entire pitch is important, a strong start is essential. Professionals must have an opening that instantly grabs investors, making them want to know more. Often on the show, entrepreneurs rely on theatrics and costumes for dramatic effect but investors are more interested in what the person has to say. Start by stating the problem in a way that is relatable and interesting. Then detail how your product solves that problem like nothing else on the market today.
On Shark Tank, audiences can easily see the human impact of a pitch. Entrepreneurs must have the ability to tell a story and connect with investors. If an investor chooses to put money into a business, that investor is committing to work closely with that entrepreneur for the foreseeable future. Just as an employer wouldn't hire an employee who seems like a bad business partner, an investor feels the same.
"I would much rather invest in a great entrepreneur than a great business," Herjavec says. "The great entrepreneur can take a bad business and make it better, but a bad entrepreneur can mess things up."
While entrepreneurs should spend a great deal of time describing their products and business models, it's also important to set time aside to talk about themselves. Investors will almost always be interested in hearing why an entrepreneur chose to found a company, manufacture a certain product, or work within a particular industry.
Tell a Story
Some of the most powerful pitches on Shark Tank have resonated because of the story behind them. They include entrepreneurs who started a business after trying to find a product for their infants to no avail, as well as couples who left their jobs after seeing early success with their products. In those cases, the stories outshine the product pitch, making audiences root for the entrepreneurs to land a partnership.
While investors often have years of experience in business, they're also human. When an entrepreneur can make a connection using a truly meaningful story, that entrepreneur is more likely to capture and hold an investor's attention. It doesn't guarantee funding, but it will at least eliminate the glassy-eyed look that means the investor likely isn't truly paying attention to the details of the pitch.
An investment meeting can be intimidating but with careful preparation, entrepreneurs can make it a success. In addition to getting all of the essential points across, it's important that professionals keep their pitches as interesting as possible to avoid losing their audience before they've even started.