Investors want to be secure, so the pitch deck should make them pay attention. Do not be another pitch they hear, then quickly forget. Failure is not an option. Here are some common blunders that will make you scream “Fail!”
1. Companies making the wrong investments: Not knowing who they are meeting with is one of the biggest mistakes companies make when seeking venture capital. It is a waste both of your time as well as theirs to meet with the wrong people. Do you think your business is in line with the areas of expertise and what the firm typically invests in? A little research beforehand can save you from a disappointing pitch. Consider the type of companies that your investors have supported before. How big are they? Are they looking for established companies or start-ups? You should also ensure that there are no conflicts of interest.
2. Make a universal pitch. Unique pitches make a difference. Approaching every investor in the same way is a mistake. You are missing a great opportunity by approaching every investor the same way. Investors have different tastes and preferences.
3. Not knowing when it is time to stop: While once is fine, there are other issues that could be troubling you. You should listen to any investor who raises concerns about your pitch deck. You won’t get anywhere if other investors raise the same issue. After your pitch deck has been polished, resume with it.
4. Lifeless and boring: Your first impressions can make or break your career. Don’t be afraid to dress up and make eye contact. If you read your slides exactly, you will miss out on the opportunity for investors to interact with you and judge the presentation’s atmosphere. Fact is, most people have a short attention span. So less is more. A spark must be created almost immediately. Without shining each one, slide after slide will lose their attention.
5. Unprepared: If a potential investor is going to reject you, the only reason they won’t have a question. Potential VCs will want details about where and how they are going to use their money. They don’t owe anything to you, even their signature on a cheque. Consider all possible questions investors may ask before you begin your pitch. Be sure to have the appropriate answers on hand. You should be aware that certain questions can cause you to become defensive. Be prepared to not respond that way. A company that believes it knows better than potential investors will lose potential investors faster than any other. They are making their money so they believe they are doing the right thing.
6. Do not ignore opportunities at the informal. Formal pitches are your opportunities to secure investors. But, when opportunities arise, you should take advantage. After giving a short overview, asking potential investors for their advice could lead to formal invitations for your company to present.
7. Not letting investors know about your updates. Even investors who are not interested in your pitch want to hear from you and that you listen to their suggestions. After some time passes, call them to inform them that you have made changes based upon their recommendations. This shows you are ready to put in the effort necessary to get things done. You will not see any term sheets from them if you don’t let previous turndowns know that you made fundamental changes.
8. Being honest is not a virtue. Honesty is highly valued. Your investor may mention a potential danger to your investment. You will lose all credibility if you admit that you know. Don’t be afraid to share information about an issue you already know.
The perfect pitch deck takes a lot time and effort. It is important that you are able to support your pitch with all the things you do and say. Avoid common mistakes that can be avoided and you will see investors lined up to get a chance at working with your company.