What is a pitch exactly? And why is it important to have one? To answer these questions, let us use an analogy. Let’s say you are on a date meeting someone completely new; you are going to present the best version of yourself to the other person. Similarly, a pitch is presenting the best version of your startup to investors and your target audience.
However, creating a compelling pitch that secures funding is critical and needs lots of planning and practice. You need to keep many things in mind when you pitch your startup. That’s why we are here to help you streamline the pitch creation process with some tips.
We are 21BY72, an angel investor network dedicated to bridging the gap between startups and investors. Our Global Startup Summit includes a pitching event and startup exhibition for startups. We will discuss a few of the most effective startup pitch techniques that have worked for the participants of these events. Let’s start by understanding the components of a successful startup pitch.
What should you include in your startup’s pitch?
A startup pitch provides investors with a glimpse of your business’s market traction and competitors, allowing them to assess its potential. Therefore, you must ensure that you provide all the necessary information to build trust with the investors.
You might want to take out your pen and paper and note the following business pitch essentials:
-
Introduce your startup and the entrepreneur.
-
The problem your startup solves.
-
Highlight your team’s contribution and their expertise
-
Facts and stats on the market analysis and opportunities.
-
A reliable business model of your operations, management, finance and marketing.
-
Thorough market traction for building trust and valuation
-
Financial projections of revenue and growth.
-
Information about your competitors
-
A call to action for funding and equity you offer
-
Leave some time for queries of the investors.
Although the list seems long and complicated, it is crucial to build a brand repo. You have to be strategic with the information you add to your startup pitch. We know it seems like a headache, but with the guidance of startup pitch techniques, you can ace the next time you pitch your startup.
Techniques to Secure Funds from Investors.
There is no stoppage to innovation, and with it comes competition. Therefore, there is enormous competition in securing funds from diverse investors, including angel investors and venture capital firms. You will get one chance pitch your startup, and you have to make the best of it. Following are a few tips to help you ace the chance at a startup pitch event or a one-on-one pitching opportunity.
-
Impressing with a pitch deck!
Two minutes and twelve seconds—that’s all you’ve got to impress the investors, according to research. A VC spends about 2:12 seconds reviewing a pitch deck. So, make the best of the one chance to convince the investors to listen to your pitch. That’s why you must include the points we have mentioned in the above section.
11-15 slides are the ideal pitch presentation to keep the investors engaged and present your startup effectively. One of the most helpful pitch deck tips is to avoid excessive filler words and add some statistics and figures to show your market traction.
-
Tailor your pitch as per the audience.
Do you expect your English professor to understand your presentation on complex integration sums? They may get the hang of it, but there is a chance that half of it will fly right above their heads. Therefore, when you pitch your startup idea, understand your audience and tailor the pitch to their expertise.
The personalization of the pitch varies depending on where you are pitching your startup. For example, if you are presenting at a startup pitch event, you are likely facing a large audience, and hence, you need to keep the pitch simple for everyone to understand. However, if you are approaching an angel investor or VC firm specialized in your industry, you can use industry-specific terms.
-
Create an engaging story.
Investors know nothing about your startup. It is up to you how you are going to present it. Paint the canvas with beautiful visuals that tell a story to maintain their attention and impress them to invest. Therefore, using stories as a relatable reference can add the necessary personal touch to your otherwise formal presentation.
Create a real-time example or tell a story about the problem your startup aims to solve and how your startup’s product/service is the best answer to that problem. It builds solid argument and is more likely to impress investors when the problem is relatable or genuine.
-
Include relevant stats and facts.
Words are impressive but not reliable. Investors are more interested in your numbers and facts than the game of words. So, include authentic stats regarding your startup’s market opportunities, market traction, competitor analysis, financial forecasts, and other relevant information. These numbers a facts back your valuation and win the investor’s trust. Avoid using false or anonymous stats because the investors will know, and it will impact your startup’s brand image in the industry.
-
Demonstrate your startup product/service.
We know that the time window is often tiny for you to pitch your startup. However, if possible, you should demonstrate your product/service while pitching, enabling them to see your startup idea in action. Therefore, you must create an MVP before meeting to impress the investors.
-
List competitors and your competitive advantage.
We live in a world where competition is inevitable. If you say you are tapping into a market with minimal competition, investors might see that as a big red flag or a lack of research. Therefore, do thorough research on at least a few (ideally 2-3) competitors, their offerings, and how you have a competitive edge over them.
-
Avoid overloading information.
Getting carried away while you pitch your startup is a common occurrence. However, you must control how much and how complex the information you’re bombarding the investors with is. Avoid adding unnecessary information and stats in your pitch, and keep the language simple.
-
End it with a clear call to action.
End your pitch with a clear and thoughtful call to action. The ‘call to action’ is your request from the investors. You can ask them for funding, mentorship, or more. The key is to be clear about it. You can then modify your request based on the investors’ queries and offers.
-
Practice, test, and improve your pitch.
Unconsciously, we use a lot of filler terms like ‘so,’ ‘ah,’ and ‘um.’ It might show your low confidence or lack of preparation with the investors, affecting the funds you want to raise. Furthermore, stage fright is real, especially when your startup is on the line. Therefore, you should practice your pitch and prepare answers to some common queries.
Conclusion
‘How to pitch to investors?’ is one of the most typical conflicts that many entrepreneurs encounter. When you pitch your startup to investors, the outcome can make or destroy its future. Therefore, we put together a few strategies you should implement in making your pitch deck and pitch to properly explain your startup and its insights to investors.
To effectively attract investors and secure cash from them, focus on developing an audience-focused pitch that includes a captivating tale and real numbers to support your valuation. Demonstrating your startup idea helps you engage investors more effectively. Make your appeal to the investors to negotiate clearly. Practice your pitch to improve it and develop confidence. The pitching event at the Global Startup Summit by 21BY72 provides the ideal opportunity to test your pitch and also secure funding. Explore our website to know more.
FAQs
1. What is the meaning of a pitch deck for a startup?
A pitch deck is a presentation showing your startup’s business plan, value proposition, market potential, financial projections, and funding requirement It’s a key tool used to persuade investors, stakeholders, or potential partners to support your vision. Typically consisting of 10-15 slides, a pitch deck should be visually engaging and deliver a clear narrative about your startup’s mission and future potential. The goal is to spark interest, encourage deeper conversations, and ultimately secure funding or partnerships for your business.
2. What are common startup pitch mistakes to avoid?
A few things must be avoided when creating a pitch deck and pitching your startup. Following is the list of the most common mistakes entrepreneurs make:
- Using a generic pitch deck and pitch
- Overloading the pitch deck with text, stats, and charts
- Not explaining the problem your startup solves
- Lacking market research for demand trends
- Over- or undervaluation of the startup due to lack of research
- Lack of competitor analysis
3. Where should you pitch your startup?
Pitch your startup at events, incubators, accelerators, and startup competitions to gain visibility and connect with investors. Networking events and industry-specific meetups also provide opportunities to pitch directly interested stakeholders. You can also use these networking events to find other investors willing to listen to your pitch. For niche markets, consider industry-specific startup events, pitching competitions, local venture capital firms, or government funding programs. Tailor your pitch for each platform and audience to maximize your chances of success.
4. How do you pitch your startup idea?
Grab the investor’s attention with a captivating opening line. Clearly define the problem your startup addresses, followed by your solution and unique value proposition. Use visuals and storytelling to explain your business model, market potential, and competitive edge. Showcase your team’s expertise and present realistic financial projections. Finish your pitch with a strong call to action, such as requesting funding or partnership opportunities. Practice thoroughly to ensure confidence and clarity, and be prepared to answer investor questions with concise and compelling responses
