It is still crucially important to focus on what your business is, and how you intend to execute and grow that company, when delivering an investment pitch. A clear grounding in your business idea will inevitably make you more confident as you won?t be worried about being found-out, or being unable to answer a question. A focus on the substance of your business is very much a win-win when preparing for a pitch. What does it do? This might seem obvious, but all too often in pitches, prospective entrepreneurs have not thought deeply enough about their idea, meaning they flounder when questioned about potential pitfalls or problems. Before entering an investment pitch situation, you must make sure you have a clear grasp of the product or service your business provides, the problem it solves, and how this will, or already does, work in practice. During the pitch, many investors will put themselves in the position of a user, asking you to guide them through the ?user journey? of your business idea. Practice this by explaining to one of your friends, who doesn?t know already, how your business idea will work. Encourage them to ask questions and if they ask one you can?t answer, don?t become dispirited or brush it aside, go away and think about what the answer is. Repeat this process for as long as it takes before you can answer any potential objections. If you cannot explain the idea clearly to a friend, then you will not be able to explain it the high-pressure investment pitch scenario. Why you? Practice alone is not enough. An investor is then likely to ask why your business is different from others who do something similar, or why you feel this is a problem that needs to be solved, if there aren?t already any businesses in this area. Essentially, this means defining your unique selling points.?If you cannot do this then you will not be able to convince customers to use your business, and so an investor will not commit either. Where does it go? Once you have identified and clearly communicated your business? user journey, USPs and direction, you then need to consider how you get from point A to point B and demonstrate this to a potential investor.?You may have described the user journey using an anonymous person but who will your real-life customers be? If you don?t know who you will market your business to, then achieving efficient and fast growth will be impossible. If an investor cannot see potential for growth then they will not invest. You might not have thought about this because your business is at a very early stage, existing as no more than a concept. However, a good pitch is about making it easy for an investor to commit to your business idea. So while it might be possible to work these things out later, if you show that you?ve already done that work it will be impressive and it will make it easy for an investor to say yes. How does it get there? The importance of this question depends on which stage your business is at. At concept stage, the ?what? and the ?why? are much more important than the ?how?, which can be finalised later. However, businesses which are seeking investment having already established themselves with a customer base, will really need a plan on how to reach these new customers, as marketing will form a huge part of how they spend their investment. Why them? The previous article in this series talked about choosing the right investor. This was largely about making your business a success once you gain investment, but you can also use it to your advantage in the investment pitch itself. What is it about your business and this investor that made you think they would be a good match Are you excited about working with someone so experienced in your sector? Do their investment models allow your business the flexibility it needs? Much more than a nice tie or a carefully chosen handbag, asking these questions will show the investor that you are the sort of person they want to work with ? demonstrating your commitment, your confidence and your research skills. Essentially, all of these aspects come down to ensuring you do your homework ? on the investor but especially on your own business proposal. This will enable you to give a confident pitch, both in terms of style and substance and makes it easy for an investor to invest ? signalling to them that you are capable, hard-working as well as communicating the best possible version of your company or business idea. Raj Dhonota is a pre-seed investor, mentor and entrepreneur.Image:Shutterstock
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