I’ve seen a lot of pretty crazy ideas with great pitches, and I’ve seen some really great ideas that tanked because they had terrible pitches. If you’re looking for investment funds for your startup, project, or small business, you can really get ahead when you know what not to do when you make your pitch.
THE NEVER-ENDING ELEVATOR SPEECH
According to Forbes, long elevator speeches are the number one pitch killer for new entrepreneurs. We call it the elevator speech because it should take as little time as it takes to ride an elevator. If you can’t give your initial pitch in under sixty seconds, there’s something wrong. Your investors are going to feel like you’re wasting their time, and they’re going to get bored. If you bore your investors, you’re not going to be seeing any capital anytime soon.
DON’T EVER LIE TO COVER UP YOUR LACK OF RESEARCH
I’ve seen a lot of entrepreneurs who didn’t do all of their research. They forgot to do all of their homework on their financials, so they don’t know exactly how much it costs to make their product or deliver their service. They didn’t do a full market analysis, but they did some test marketing. They didn’t thoroughly test out how their idea can fail.
You know what? All of these mistakes are actually okay…if you own them and don’t lie about them. Yes, it’s a lot better if you’re thorough with your research and you have a solid business plan, but sometimes you get investors’ attention before you’re completely ready. If you know what you’re missing and don’t try to lie to cover it up, you have a much better chance of getting some capital (or at least a second chance at a pitch).
MAKING CRAZY GROWTH FORECASTS
In its first few years, Daymond would’ve loved to see FUBU grow by 100-300% each year, but he wasn’t about to tell investors that they could expect that kind of growth from his company. If your business has shown a 30-60% growth rate per annum over the past few years, what makes you think that those numbers are going to jump up to over 100% in the next years? Have the numbers and evidence ready to back up your growth projections because you know we’re going to ask about those.
“I DON’T HAVE ANY COMPETITORS.”
Don’t even go there, my friends. If you really, truly don’t have any competitors, I’m going to wonder if it’s because you don’t have any customers, either. And if you can show me that your product has a huge market but no competitors, then my next question is going to be, “What are you going to do when you get some competition?”
Believe me, if you have a great idea and there’s a market for it, then you have competition. And if you don’t have competition right this minute, you can bet that you’re going to have some tomorrow, next week, or next month. When a niche opens up in a market, entrepreneurs don’t waste any time flooding it.
When you stand up in front of investors, you want to show a strong brand, a great idea, and a lot of research. You don’t want to bore them, try to cover up poor preparation, or be overconfident without the evidence to back it up. Show them why they should invest in you and what they’re going to get out of it, and you’re going to go a lot farther than trying to make up figures on the fly or fool them into believing your brand is worth more than it is.