You have a great business idea that you foresee will meet a crucial need of the market. It has the potential of becoming the first-of-its-kind product or service. The only thing that is stopping you from scaling it up to its full potential is the lack of investment. Entrepreneurship courses can help you to gain insights on how to do that well but here are a few tips to get you started off on the right track.
- Comprehensive Plan – Keep a comprehensive plan ready. That means it should not be only focused on the financial viability of a business, but must cover all aspects that are core to any business venture. The financial data is one part of it. Do remember to share what and how you plan to or are already working on the elements related to the people(workforce), the production if the nature of your business involves this, product design and development, the technology areas, marketing and social media, legal and so on. When you pitch the entire scenario, investors are able to get a better idea of the fact that you understand the linkages between all the above aspects.
- Create a Prototype to Show – Spend a little bit of time, effort and money to create a tangible prototype, unless you already have a business that is running and therefore an actual product or service to show. This gives the investors assurance that you have done the first detailed level of due diligence and worked on feedback that you received. Alongside the prototype, or even if you are showing an actual product, remember to share, any initial research that you have done already about the customers and their receptiveness to your business.
- Share the Metrics that Define the Business – Different businesses work on different metrics. So make sure to show how the performance metrics were defined by you, for yours and how are you currently tracking them. If your business has yet to take shape, make sure to explain the kind of monitoring mechanisms that you plan to put into place for these metrics.
- Show that you know your Investors – Just as you research about the organization that you apply for or a client that you meet to sell a product to, remember to spend time getting to understand the background and work done by your investors. Do review the companies that they have invested in, in the past and what they truly assess or value, in a business. In your pitch try to incorporate these factors.
- Show how you plan to build a team – Many founders or aspiring founders believe that their presence is enough for the investors. It is true that the Founder has a huge impact on how the business is perceived, particularly when it is a new one or an upcoming one. But remember that to run a business successfully and sustainably, you need a team. If you do not have a team already that you have there with you at the pitch, you should share a plan of how you are going to build a team. The creation of a great team has been known to be a critical part of a new business, and the investors will be keen to know how you are addressing it.
- Show forecasts and ROI – This seems easy to do, but actually showing forecasts and ROI is a difficult task. You should not camouflage it with any unnecessary details. If your business is not going to become profitable for the next 5 years, you must say so and show that. Covering it up with additional elements will not only be incorrect but investors might not be able to view you as a credible entrepreneur, who is transparent in his or her communications.
- Ask for Realistic Investments – When you look for investments for a business that you have dreamt of, it can be difficult to limit it to a budget. But always remember that being realistic is the key. When you pitch the business, the investors are definitely interested in knowing and being committed to the potential it shows. They will be happy to invest in something that has huge returns at some stage. But at the same time, your role is to be practical and realistic, because only when you ask for realistic funds that meet your needs, can you start becoming more profitable and stable.
There can be many other additional ways to pitch your business to investors. Do spend time reading more and speaking to others who have gone through the process. That will give you more practical insights as well and prepare you for these discussions better.