6.1 How to Pitch an Idea to Investors (and Early Customers)
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As a freelancer, entrepreneur, or any other form of hustler, you never know when the opportunity will arise to pitch an idea.
That interesting conversation at the coffee shop could turn out to be a big deal investor.
Your gym partner mind end-up being the exact type of person you’ve been trying to sell to.
Or you might have finally heard back from that startup accelerator you’ve been hounding for months on end about getting a meeting.
The opportunities are everywhere, and unfortunately we can’t always control when they come up. Which is why you always need to be prepared to pitch.
Good pitches all share certain characteristics that you can borrow, emulate, or ignore depending on who you’re pitching to and what you’re looking for:
- A good pitch balances business and emotional needs.
Whether you’re pitching to a company, an investor, a customer, or a potential partner, you have to hit them on both emotional and business levels. Without this, your pitch is almost certain to fall flat. - A good pitch is succinct.
In most cases you only have a few seconds to capture someone’s attention and get your point across. Focus and momentum are your friends. - A good pitch tells a story.
Humans have been telling tales for thousands of years. Which is why it’s a great idea for the flow of your pitch, whether verbal or in a slide deck, to follow a narrative pattern. - A good pitch focuses on benefits.
Value beats price every single time. Rather than focus on cost or features, your pitch needs to focus on the value you’re going to create for the person you’re pitching.
What makes a pitch perfect?
- Take only ten minutes.
Timing is critical. The less time your pitch takes, the better.
A brilliant idea means nothing unless you can distil it to a few moments of sheer power. The more concise you can be, the more effective you will be.
- Turn your pitch into a story.
Storytelling is a scientifically-proven way to capture a listener’s attention and hold it. Besides, it makes your pitch unforgettable.
- Be laser-focused.
Investors’ time is their most valuable asset. If you convey a respect for their time, they will interpret that respect as your ability to treat their funding with respect.
- Explain exactly what your product or service is.
Show your potential investors a picture of, or give them the actual product to handle.
- Explain exactly what is unique about your product or service.
If you are not producing or providing anything different from the run-of-the-mill widget, don’t even go to the meeting. Go back to your drawing board, and design something better.
- Explain exactly who your target audience is.
Use demographic and psychographic features to pinpoint your customers. Show investors a picture of a customer along with relevant data points.
- Explain exactly how you intend to acquire these customers.
Business success comes down to marketing. If you have a marketing idea, method, technique or process, this is your chance to showcase it. Contrary to pithy maxims, great products don’t sell themselves. You sell the product. To be persuaded, investors have to see an airtight strategy for getting the product to market.
- Explain your revenue model.
Investors invest because they want to make a return on that investment. An investor will care about your pitch if you can answer this question: How will my company make you rich?
- Be wildly enthusiastic.
A good technique for increasing your energy level is to add about 50 percent more energy than you feel comfortable with. Entrepreneurs must crawl out of their comfort zone.
- Dress to kill.
You can judge a person by the way he or she looks. That may be unfair, and you may resent it, but you’re not going to overcome this natural human tendency.
- Practice your pitch.
And then practice it again. And again
- Anticipate questions, and answer them ahead of time.
If an investor is interested, he or she will ask more questions. Be ready for these questions.
- Show them the exit.
Every investor wants to make a lot of money in a short amount of time. What is a “short amount of time”? A five-year benchmark is a safe time frame. Your plan and pitch, then, should explicitly answer the investor’s unstated question: How will this make me a lot of money in five years?
