Zooming in on possible VCs is only the tip of the iceberg. You’ll need to focus on creating a winning pitch to get your startup noticed by the right VC for your startup.
Here are six tips you can follow to make sure you’re as ready as you can be to face those investors.
Make sure your startup has what VCs are looking for
Some VCs will tell you on their website what they’re looking for in your investment pitch, but as a general minimum, you’ll need to know at least the following:
First, customers. Depending on the nature of your startup, your customer base can be very broad or very niche. This matters to VCs because they want to see what the market potential for your business might be.
Don’t worry if you have a niche market—many businesses thrive and dominate their niches. Let VCs see that your startup can do just that and even has the capacity to expand into future markets if applicable.
Next, VCs will be looking for your Minimum Viable Offer (MVO). This is an offer, many times a prototype or beta version, that provides the least amount of benefits to merit a sale from your target customers. This doesn’t have to be perfect—it only has to show VCs that you can solve a very specific problem for customers extremely well.
Yet another thing you’ll want to iron out is your founding team. Knowing your founding team also helps you craft your startup’s story. Why were you founded? What made all of you come together? What makes this team potential leaders for a growing business?
Last but not least, if applicable, talk about any existing employees you already have or plans for the kinds of employees you want to hire once fully funded.
If you’re on a tight budget, you might be able to save money by working with remote workers around the world—just figure out the logistics of how to work with them and pay them accordingly through different payment sending platforms.
Include details like this in your pitch to show prospects how much you’ve thought out your startup operations.
Build a pitch deck and presentation
You’ll need to design a beautiful and clear pitch deck to help you illustrate compelling points, data, and numbers that VCs have to pay attention to. Refer to this post to see what information you can use to help you build out your pitch deck.
As a general rule of thumb, remember these tips:
- Start your pitch by illustrating a problem, then introduce your startup as the solution.
- Use charts and graphs to highlight statistics and data best.
- Include projections visually and be sure to know how you came up with those numbers.
- Keep the deck branded. As early as now, you can show VCs that you’ve got a brand that’s waiting to reach the hands of your customers.
Perfect your elevator pitch
Your elevator pitch is the one-liner explanation of what unmet need your startup aims to solve in the world. This is a statement you’ll want to have when you introduce your startup as a solution to the problems you’ve enumerated in your pitch.
This helps VCs understand in a very succinct way what it is your startup does. But it also holds another use: in case your meeting or pitch is cut short, an elevator pitch makes sure you can relay your startup’s purpose in as little time as possible.
Look into the right VC
Getting the right VC is often like getting a role at a TV audition; sometimes it’s just about the right fit.
Don’t take it too personally if you get a rejection from what you thought was a promising VC. Many times, investors are looking for specific startups, either in a certain industry or with certain values.
Consider this an opportunity: if you find the perfect VC, you’ll also benefit from their ability to meet your startup’s specific needs.
Send proposals to a few prospects at a time
As a rule of thumb, treat your startup proposal like a job application. You don’t want to keep all your eggs in the same basket, so send out proposals to a few prospective investors at a time.
Only move on to new VCs once you’ve heard from all your prospects.
Trust the process
In this interview with Rand Fishkin, founder of software companies Moz and SparkToro, he mentions that early-stage failure in his first startup helped him to get monumental success in his business later on.
We can learn from Fishkin’s experience, and treat the VC pitching process as feedback. If your proposal is rejected right from the onset, try to gather why you didn’t even make it to the pitching stage. If your pitch is turned down, try to ask prospects what they were looking for that you simply didn’t provide.
All these can only strengthen your future pitches to future VCs. So trust the process.
Key Takeaways
Getting your pitch accepted by investors can be a difficult process, but if you’re equipped with the right tools, mindset, and information, it doesn’t have to be. Follow the tips above to boost your chances of getting your pitch noticed by VCs.