From my years in the capital markets and my current involvement in the Los Angeles “Silicon Beach” tech scene, I have spoken with several investors (VCs and angels) and attended events where they talk about their turn on’s and off’s of prospective investment companies. Here are a few of the top tips that every entrepreneur should keep in mind as they pitch for funding:
- Don’t lie. Investors, and particularly VCs, do significant due diligence so will find out anything you may be trying to hide. Be honest and authentic…it comes across and gives them a sense of how you will handle their money.
- Be confident but humble. It’s a fine line but arrogance is an immediate turn off to investors.
- Be the expert. When it comes to the industry and market you are playing in, you need to be the most knowledgeable person in the room. Inspire confidence by being able to answer their questions. If there is a question you can’t answer, there’s nothing wrong with saying you will get back to them…just be sure you do!
- Know your pitch deck. You need to know your presentation inside and out, and every number in it. Practice the pitch and have the data to back up every point. You should be able to discuss any point in the deck without notes.
- Understand their reality. Be respectful of their time and how they are motivated and compensated. VCs have their own investors to answer to and make money for. For angel investors, know your audience. This is their personal money so the product or service has to resonate with them personally or be in line with their own expertise and background.
BONUS TIP: Don’t take it personally. All investors, VCs, and angels see several hundred pitches per year and only pick a handful. You actually want to get to “NO” as soon as possible and not waste your time trying to convince someone when they are never going to be interested.