There is little doubt that angel investors have proved pivotal in getting some fledgling businesses up and running, giving them the cash injection needed to put their ideas into action and generate decent profits if everything goes to plan.
If you are pitching your business idea to a number of angel investors it can be a daunting experience, especially when you consider what is at stake, which is why you need to approach the opportunity in the right way so that your odds of gaining an investor improve.
Here are some of the must-do pointers when pitching your plans to an investor.
First impressions count
Your presentation has to tick a lot of boxes to fuel the interest of angel investors and it also has to be put together in a slick format that makes the opportunity easy to understand and exciting enough to tempt someone to take a punt on your business.
Aim to create a punch presentation that achieves all of these aims within a 10-minute pitch, as you can save the greater details for those that express initial interest.
Rehearse your pitch
Go through your presentation as many times as needed beforehand so that you deliver the proposal with confidence, which always reassures investors.
Identify a niche
Even if you are not re-inventing the wheel and pitching an idea that is not totally innovative it is still important to explain why what you are offering is better than the products or service that already exists.
Your goal should be to convince an investor that satisfies a niche or offers a better way of doing something than currently exists.
Know your market
Expect to be grilled by an investor about your target market.
Make sure you do your research and can demonstrate that you know who will want to buy your product or service. This is clearly important to an investor as they will want to know how you are going to grow the business so that they can get a decent return on their investment.
Show me the money
Following on from that, every angel investor will want to examine your revenue and business model in order to confirm that your numbers stack up.
Make sure you can answer all the key questions and demonstrate how the business is going to generate a profit.
Angels invest in people
The bottom line is that many angel investors will walk away from what could actually be a great business idea if they don’t feel they can invest in the person or team behind the business.
It is often said that angel investors tend to prioritize their investment strategy with a view to investing in people first and the business idea second.
Your pitch should focus on demonstrating that you are a competent and accomplished entrepreneur and your team should also be introduced so that an investor can be confident that they will be working with a professional and focused group of people that can be trusted.
If you follow these simple but effective rules of engagement it should improve your odds of winning the investment you need to grow your business.