Looking for funds to boost your startup company is not an easy job. You might feel enthusiastic about the whole plan and confident about giving it a concrete shape, but do your investors feel the same way? Are you knocking the right door while seeking venture capital? And most importantly, are you saying the right things in your presentation?
In general, angel and venture investors prefer allocating funds to later-stage companies so as to minimize risk factors. However, some positive trends have been noticed recently, for instance, when some big pharmaceutical establishments extended support to early-stage companies.
As budding entrepreneurs, it’s quite natural to feel over-zealous in the beginning while giving that pitch to potential investors. Yet, there are certain traits in your presentation than can scare even the hardcore venture capitalists away. Here are the 3 things you can say in your funding pitch which can spook your angel investor:
Dishonesty or lack of transparency
The fastest way to repel investors is by being dishonest or crafty. Discussing your full plan starting from business model to potential customer base is the best way to take your investors into confidence. If you are not transparent about the communication then that would put venture capitalists in a dilemma about whether to trust this person or not! Drawing too rosy of a picture about success rate or influential connections is also not advisable.
Lack of confidence in presentation
Yes, it shows if you are lacking in confidence while giving that presentation. Forgetting facts, offering incorrect/inadequate information also shows your careless attitude which investors don’t really take kindly! If you are careless about your slides, then venture capitalists too would become casual with their investments.
You might feel confident about your impromptu speech, but don’t do it while facing potential investors. Prepare the presentation in advance. If needed, do take the help of expert scriptwriters. Rehearse it several times. This will help to instill confidence when you finally face those hardcore investors.
Present as a lone founder
It might be the first presentation, but make sure to present your team before investors in this initial meeting. This shows that you have the strong support of expert professionals who would help in giving practical shape to your ideas. A team of experts willing to support the startup always provides a stronger picture than a dreamy-eyed lone entrepreneur!
Apart from these, a few other aspects should be noted while approaching investors. Your pitch shouldn’t give the impression of an arrogant and difficult-to-work-with entrepreneur. Funding would elude you if investors sense that you are only eyeing their wallets but unreceptive to their inputs and guidance. Then there are certain sectors which find it more difficult to fetch funding; the pharmaceutical industry is one of them.
Some market analysts are of the opinion that VCs can hurt a startup too, by offering negative or wrongful advice. It is very crucial for an entrepreneur to be active and informative. If he doesn’t know the customer base and their needs, then no matter how easily funds flow in, the startup won’t be able to make much headway in the right direction.