There is only one objective in an investor pitch — and it’s NOT perfection
Know before you go and level set up front
Which side of the investment pitch table have you been on? For me, the investor (or buy side) role has been the norm, so keep that top of mind as you read and perhaps heed the suggestions in this post.
The image at left imparts the approach we at TU Incubator impart as requirements for a good overview pitch to investors. Your story and your ultimate objective can be accomplished in twenty minutes or less but you will likely have achieved what you need in the first five minutes.
Let’s say you are an entrepreneur who has never built an emerging but scalable technology enabled business before and to do so requires outside capital to get to market at speed.
Your intro is where you warm up the room and unveil your one-liner that tees up a massive problem (or opportunity).
Is your problem really worth solving? Is it a worldwide, massive, intractable conundrum?
Is your solution something that evolves with increments of roll out and nuance or more all-at-once and capital intensive?
Wow your audience with a live product demo but also prepare for any and all tech contingencies. A backup video of a demo is worst case preparation.
Your marketing and sales approach is where faking it is never a good idea. Meticulous planning and testing backed by proven or comparable go-to-market is key.
A proven or believable business model is key. Every investor wants the comfort of visibility to sustainability, what otherwise might be called break even. Very few investors have the patience or pocket depth to test new and shiny business models if your burn rate is high.
Businesses succeed or fail because of team more than any other reason. Okay, product market fit is a big factor too. But, that’s often because of team discord, team lack of experience, or team with lack of objective market testing. Your team should be your company core competency, one you work to improve each day, week, month, quarter, and year.
If you are building such an incredibly novel solution where there is no direct competition, then you had better be pitching a massive, top ten venture firm. Be honest, smart, and tenacious about the competitive matrix and check your ego at the door.
The financial forecast is a combination of actuals and art; you must have some of the former to be credible with the latter. Simple P&L and believable years 1–3 often yield a tight use of proceeds. Know your bottom-up projections very, very well.
Your final slide is your current status and projected milestones. To get to these, you must have capital partnership and you must ask for the same. Do not sell past yes, but remember that your immediate goal is not to get a term sheet. It is to get a follow-on meeting with one or more decision-makers.
Looking for pitch deck comps? Check out Buffer’s 2011 seed pitch deck.
And you might use Sequoia Capital’s template pitch deck:
The punchline and ultimate objective of the pitch meeting, after unpacking the increments above, is merely to get to another meeting. It is not to get a hard- or even soft-circled commitment, although you would stop at YES in either case. Tempered expectations and front-loaded level setting lead to a fulfilling meeting and often lead to a second meeting.
“My expectations were reduced to zero when I was 21; everything since then has been a bonus.” — S. Hawking
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I am a contrarian educator located in Baltimore, MD working at the nexus of impact, efficacy, and economic upside. As Towson University’s Director of Venture Creation, I help support Maryland’s largest cluster of edtech companies via TU Incubator and associated programs.