To start a business, you need some kind of capital. Raising money from investors for your startup can be difficult – you need to convince them that you, and your company, are worth investing in and you need to do so quickly.
Messing up at this stage really could be detrimental to the future of your enterprise, so it’s important that you get your business pitch right from the off-set.
Here are some top tips to help you:
Keep it succinct
An elevator pitch is vital. Learn how to summarise, and sell, your business in 60 seconds in a manner that is short, sweet and to the point. Investors will assume that if they can’t grasp your business concept in a short time span, your customers won’t either. Focus on the absolute best bits of the business and talk about them with passion.
Most investors look for low-risk businesses run by proven managers with a successful past record. It is therefore important to discuss facts, not fiction. What is your cash flow situation? Do you have any previous experience of establishing successful businesses? Have you tested a prototype and if so, what was the success rate?
Frame how your product/service is different
Chances are your idea has been done before, so how are you different? What can you offer to the market that your competitors can’t? Use market data to back up your claims – for example, if you are going to open a fair trade store selling locally sourced food, is there any data to support the rise in demand for this type of produce? How do you intend to market yourself?
Focus on pain points
A “pain point” is the market need for a specific product or service. This supports the above point – the pain points you wish to address are what makes you different from your competitors. Innocent smoothies, for example, saw a gap in the market for drinks that are honestly good for you, while still being delicious. They are now a multi million pound business. Why do you think the market needs your business?
Express your personality
Great stories sell products. If you have a back story that led you to the point of starting your business, tell it. What is the most interesting or exciting part of the story? What have you learnt from it? And why will it make you even better at business?
Often, investors are putting their faith, and money, into you, as well as your brand. If you are able to show them some of your personality during your pitch, you will come across as more authentic and trustworthy and, hopefully, this will make them like you. If you can achieve this, you’re part of the way there.
Be prepared to answer any questions
Know your business inside out – this involves understanding the market and your target customer. Investors are experts in spotting any insecurity within business plans, so make sure you answer their questions confidently and in detail.
Sophie Turton is assistant web editor of Crunch Accounting.
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