What investors want to hear is simply explained on an excellent 10 minute video, on Dorset Business Angels Entrepreneurs website page. On the same page there are some helpful resources for businesses seeking funding and preparing their business cases. I watched this video again recently. I thoroughly recommend it for anybody who wants help or advice on how to pitch to investors. Having watched many videos, and read a lot of blogs and articles, this video guide stands out, as succinct, clear and certainly covers what Dorset Business Angels investors want to hear. Below, I have written a summary of this Formal Pitch video which features Tom O’Flaherty entrepreneur and investor, listing topics investors want to hear from entrepreneurs for the perfect investor pitch, and importantly the sequence you should present. I have kept this article in a list format to make it as clear and helpful as possible, for presenters working in real-time. I base this on personal experience having pitched successfully, and seen hundreds of pitches, and invested too.
For an angel network, the typical investment sought will be £10s to £100s of thousands. Note, the video speaks of dollars, but it is the same in the UK, ie pounds, where we typically look at £100k to probably £1-£2m. Above that you are moving into Venture Capital and debt funding.
The typical topics a presentation pitch should cover will be as follows.
- Size of market
- Management advisors
- Your solution
- How you will make money – model, customers
- Getting to market
- Financial projections
- Liquidity – ROI ie the Return on investment, how much, what multiple and when, for example in 2, 5 or 10 years? And what is the exit i.e. A business exit strategy is an entrepreneur’s strategic plan to sell his or her ownership in a company to investors or another company.
The “Secret Sauce” – how to do it better
- Cover the market first i.e. convince people there is a need. There is a danger, inventors and entrepreneurs come up with a prized idea. It excites them. But does it really solve a problem? Will people pay for it?
- Convince people you are not a solo act. What happens if you are sick? What happens, when the company grows? What happens if one of the team runs off with your ideas, or takes customers away? Have answers for this. You need a team, an infrastructure.
- Market: who is the target? Customer Persona – more here on this
- Be convincing there is a customer problem. Is it a big problem or just a nuisance how big?
- What is the customer doing now?
- Is yours the only solution now?
- How big is the market? How do you know? How do you determine this? What is behind the number? In the old days you’d go to a library to look up the numbers. Now define how you have sized the market; how many prospects, don’t assume there is anything magical in the process – be clear, investor can do numbers too!
- Investors invest in people. So who else is in your team, and what are their credentials?
- Product: what, how it relates to competition? Avoid technical detail unless asked.
- Liquidity or ROI – how the investor gets it back ideally in a reasonable time? You may not know exactly but as much as you know.
Do your presentation in the right order – you’ll have the best opportunity!
Good Luck – Contact Dorset Business Angels if you have a deal for our Investors
Dorset Business Angels investors are always interested in good deals. Contact us, send us your deck, plan and 1 page summary. Call me if you need any help or have a question. I hope it has helped to produce a summary of the Formal Pitch video featuring Tom O’Flaherty entrepreneur and investor, listing topics investors want to hear from entrepreneurs for the perfect investor pitch, and importantly the sequence you should present. I have kept this article in a list format to make it as clear and helpful as possible, for presenters working in real-time.
Peter Eales BA Hons Chartered Marketer FCIM FIDM
Founder Director Dorset Business Angels
MD o i solutions limited