14. March 2018
10 Most Common Mistakes When Pitching to Investors
They come late, read from PowerPoint and do not keep to time limits in their presentations. Such are the sins of entrepreneurs when pitching their startups to investors. If you want to impress an investor, read on so you can also avoid the following mistakes.
The coffee is already cold and the entrepreneur is nowhere to be found. Being late is not very respectful. Time is money, right? If you consider the investment a life or death opportunity, you’d better set two alarm clocks. Coming half an hour earlier is much better than five minutes late.
Focusing on slides instead of on the investor
PowerPoint is a helpful thing for the investor, not for the person presenting. Watching the presentation instead of looking the investor in the eyes is a bad habit. Slides are not obligatory. Know the things you want to say by heart. It makes the impression that you know what you are talking about.
Having an overdecorated presentation
The investor came to listen to you, not to read long texts in PowerPoint. Avoid too much text and photos. If you have 10 minutes, eight slides including the introductory one will be sufficient. We prefer simple slides with two sentences that only point to the topic and mention important facts.
Talking too much about the business model
Investors buy simple products because they believe your product covers a gap in the market. They want to know that your team will use money efficiently to deliver the product to the market. Entrepreneurs should therefore spend the most time describing their product and team. If you are meeting the investor for the first time, do not forget to mention the business model, but do not spend more than 2 out of 10 minutes on it.
Raising more questions than answers
Investors are meticulous. Once they discover a hole, they immediately go and look for another one. Your argumentation must be like a bulletproof vest: so thought-out that it will answer questions and not bring new ones. Otherwise, you will lose points. There is never enough time for the investor to ask all questions.
Not keeping to time limits in presentations
Time has run out, but the entrepreneur is still rushing through the presentation and the investor is lost. Results? Anxiety on the one hand, misunderstanding on the other. If you want to sell your story, give the investor enough time for questions. Speak only about the most important pillars of your startup and do not get bogged down in details. Simplicity is the key to success.
Not accepting feedback
The product will change a hundred times during its development, so it's important to be flexible and open to feedback. This goes not only for advice from family and friends, but also from people who have an impartial view. If an entrepreneur does not want to hear advice and tries instead to convince the investor only of his truth, cooperation will be difficult. Keep a reasonable balance between faith in your product and openness to other people’s opinions.
Being either too shy or overly confident
If entrepreneurs do not believe in what they are saying, it will not make a good impression. The investor will start doubting whether the person can succeed in their business. On the other hand, high self-esteem or arrogance is also not a good signal. Strike a good balance: neither too much, nor too little confidence.
Coming in ripped jeans
The startup environment is relaxed, but occasionally an elegant shirt can look good. Investors do not want you to wear ties and wristbands but coming in ripped jeans is not the best outfit either. Do not worry, once you get the investment, you can wear sweatpants at work.
Choosing the wrong presentation style
Ctrl + C, Ctrl + V does not work for presentations. There is something different about every audience, so always adjust your presentation to the people who will be listening. When you are at a startup event, you can do a spectacular show. When presenting to investors, focus rather on facts, figures, and arguments.