By Daymond John
When an entrepreneur stands in front of me and the other investors on Shark Tank, they have the opportunity to grow their business and build a lasting partnership with one of us. They also have the opportunity to completely flop and leave us thinking, “What even just happened?” How you talk to potential investors actually has a lot to do with whether you fall in the former category or the latter. Follow these tips whenever you approach a potential investor, and you’ll be a lot more likely to get funding.
BE CALM AND CONFIDENT – BUT NOT COCKY
First, if you’re really nervous, you’re probably going to fidget a lot. Your voice is going to crack, or you’ll talk too fast. You’ll have trouble making eye contact, and you’ll feel like the room is at least 105 degrees. Unfortunately, all of that makes a big difference in how your investors see you.
If you’re sweating bullets and your hands are shaking all over the place, I’m going to wonder if you’re just nervous because you haven’t done a lot of public speaking or if you have a reason to be nervous. If I start to wonder if you’re nervous because you don’t have confidence in your product or you’re trying to scam me, then I’m not giving you a single dime. If you project confidence, though, I’m going to be a lot more interested in what you have to say.
That said, don’t go overboard, or you’ll come across as cocky. Investors are interested in growing businesses and getting high returns, but they’re also interested in working with people they like. If you’re too cocky, I’m going to wonder whether your confidence is really founded in reality, and I’m not going to be too excited to work with you, either.
PRACTICE, PRACTICE, PRACTICE!
Showing a lot of confidence when you’re asking people for thousands of dollars can be hard. Balancing the line between being too timid and too cocky can be hard, too. That’s why every successful entrepreneur I know spends a lot of time practicing their pitch before they meet with their investors.
Practice your elevator speech until it sounds natural and professional. If part of it seems awkward, look at how you can rewrite it so that it flows better. Rehearse in front of one of your friends, a business partner, your spouse, or a family member. Then give them a list of questions you expect investors to ask, and get them to ask you a few of them at random. That will give you a chance to practice talking with us, defending your ideas, and showing us why we should invest in your business.
DON’T MAKE A CAREER OUT OF YOUR PITCH
You never want to see an investor check their watch while you’re talking. You want to keep their full attention, and that means keeping it short and sweet. Pack as much information as you need into a short elevator pitch. Tell them who you are, what you’re doing, and how investing in your business can help them. Details and numbers can wait until your investors start asking you questions.
Then, when they do ask you questions about your business plan, make sure that your answers are clear and concise. Again, don’t go on and on. Keep your investors engaged by giving them the information they’re looking for, not by drawing out your replies.
After you’ve made your pitch and answered your investors’ questions, go ahead and ask for the sale. You’d be surprised how many entrepreneurs walk away from meetings with investors empty-handed just because they didn’t come out and ask for funding. You can get a lot done if you’re confident, clear, and concise, especially if you’re not afraid to ask for what you need.