The Essential Prep Guide to Pitching Investors (Part 1)
Pitching to a potential investor can be incredibly nerve-wracking, regardless of what stage you’re at in your business. One way to tackle this sense of nervousness is to prepare your pitch meticulously and intelligently. However, from conducting research on angel investors or VCs to carefully editing your deck, preparation for your investor meetings can take on many forms.
Because many founders don’t know where to start in the preparation phase, we’ve created a two-part checklist that can be utilized no matter who you’re pitching to or what industry you’re in. Consider this checklist your secret weapon for potential investor meetings.
Part One: Research
Researching the right investors to reach out to can be tricky and time-consuming. We at Know Your VC recommend the following three criteria to narrow down your search:
- Target Investment Size. If you’re looking to raise your first seed round, it probably doesn’t make sense to pine after firms like Sequoia or Accel, who typically write initial check sizes of at least $5M. Stick to investors who are better fit for your stage like seed funds and angel investors.
- Industry Focus. You can usually tell from a VC’s recent Twitter feed or company website which areas they’re excited about investing in right now. If you are building a hardware consumer company, you may be barking up the wrong tree if you are reaching out to a VC who primarily invests in SaaS companies.
- Investor Characteristics. Most importantly, you should determine what type of investor you want based on what he/she will do for you after the investment. Would you rather have someone who is highly involved and expects biweekly strategy calls, or someone who is more hands off? What do you value in an investor aside from the money? Is it product expertise? Is it a strong network?
The first two criteria can be determined pretty easily through a bit of research on sites like Angel.co or Crunchbase. However, it can be tough to find information on individual investor characteristics unless you are extremely well-connected in the startup ecosystem and have founder friends who can give you the inside scoop on their experiences.
For the rest of us, there is Know Your VC. It is the largest platform for verified investor reviews and has collected hundreds of thousands of investor data points on stage of investment, industry focus, individual characteristics, and more. In addition to providing access to these investors insights, we also use a blend of these three criteria in our internal recommendation engine to give founders a curated “cheat sheet” of the investors they should meet with along with recommendations on how to best get in touch with each of them.
Engaging with potential investors on Twitter, connecting with them via LinkedIn, or getting an introduction through a portfolio company can all be effective methods.
Please do not send “personalized” template emails to all of your prospective investors, as the smart ones can tell that it is part of a mass email campaign and will most likely never respond.
When you do manage to get in touch with an investor and he/she has agreed to an initial meeting, now the fun part begins.
Part 2 of this guide will focus on getting your pitch deck to be presentation ready and also share essential advice on pitch meeting etiquette.