10 Mistakes to Avoid When Seeking Investment

The art of the perfect pitch is to know what you are selling and to sell it well. Looking for investment can be stressful and time consuming; but the more prepared you are, the quicker and more easily a deal can be done. Here are 10 mistakes every small business owner should avoid when pitching to investors 1. Don't contact every investor you know !o your research. "ot all investors are interested in every type of business, and not all investors are willing to invest the same amount of money. #ind out what types of companies they have invested in previously and at what stage of business. $enerally this type of information can be found on the investor%s website, but you can also make use of social media platforms like Linked&n and 'witter to see who they are talking about and who they are talking to. (nce you have completed this research, target the one or two investors who you think best fit your business. 'his research will save you time from pitching to investors who are not interested, and will help to demonstrate that you have done your due diligence.

6. ___________________________________ 4oth you and the investor are there for one thing. .oney. 4y agreeing to meet with you the investor is assuming that your business is viable. (f course you should e+plain the product or service that you supply, but your meeting should be focussed on the financial opportunity. 'alk about how much money you are seeking, the percentage of the business equity that will represent and specifically what you intend to spend it on. 0n interested investor will ask more about the product if they need to.

7. ___________________________________ 8hen presenting your pitch, make sure you look the part. 2. ___________________________________ 'his doesn%t have to mean a suit; but it does mean a clean )trike a balance between providing enough information to professional outfit and groomed hair. interest investors, but not so much that the investors get &t also means you have to be aware of your body bored or have little time for questions. language. .ake sure you maintain eye contact. !on%t &f you have an hour to present, create enough slides to wring your hands or put them in your pockets. present for *0 minutes and then *0 minutes for questions 'he investor will make allowances for nerves, but fidget and answers. 'his should be appro+imately 1, to 1- slides. too much and you look like you%re hiding something. .ake the slides visual as well as factual. &nclude results 8. ___________________________________ from surveys, product tests and provide any client quotes 2our presentation should be clear and concise. !on%t use or insights you have gained. acronyms the investor may not have heard of. !on%t use &f you have a product or prototype, make sure it%s fully bad language. charged and ready to demonstrate to the investor. &f you &nstead present yourself as passionate and enthusiastic. can hand out samples, do it, everyone likes free stuff. 9ommunicate what your idea is, why you think it%s great, 3. ___________________________________ and why it will be a financial success. :emember though, 'hink beforehand about the questions you would ask how there%s a fine line between being enthusiastic and coming large is your target market, who are your competitors, why across as a slick salesman. #ind the right balance. is your product better than your competitors, how much 9. ___________________________________ money have you made, what are you growth plans/ )how the investor how they%re going to make money. 0lso be prepared to supply alternative strategies, if an 7rovide figures for pro5ected turnover and net profit over investor doesn1t agree with your plans. the ne+t three years. &nvestors don%t want to be your 0nswer questions in a calm and collected manner and partner for life; they want to make their money and get out. make answers as complete as possible. 2our relationship 8hether that%s selling to another company, going public or with this person is likely to be long3term; therefore your letting you stand on your own two feet. communication will be important. 10. ___________________________________ )o the pitch went well, you felt you connected well with the investor; now you need to close the deal. #ollow up with a phone call after the pitch. 0sk the investor if they have any further questions or concerns you can help with. 0sk outright if they are looking to invest. &f 5. ___________________________________ they are, schedule a second meeting. !on%t think about getting 5ust enough cash to get you 4e prepared to discuss the details quickly and efficiently. through the ne+t 1, to ,6 months, think about your long 'he longer you take to respond to questions or requests for term plans. information, the less likely the deal will be completed. 7lan achievable goals and aim for them. &t%s better to :emember investors are looking at other businesses, and raise more money than you need than too little. 0nd it will if one of those is quicker or smarter in supplying details, make the investment feel more attractive. your deal will be replaced by one from someone else. 4. ___________________________________ 4e realistic and tell the investor how they are going to earn their money back and more, and in what time frame. 0dd credibility to these facts by identifying your rivals and e+plaining your competitive strategy.

A. Read the article and choose the correct headline for each section:

D. Are the statements !elow true or false? 1.

4e ready for questions 4eware death by 7ower7oint !on1t contact every investor you know !on%t get carried away talking about the product !on1t promise the moon !on%t use abbreviations and don%t read a script Look at the big picture 7rovide an out )eal the deal 'hink about your appearance

&f you present your pitch well enough, any e+perienced investor will be interested. 2ou should allow 1031- minutes at the end for questions. 2our pitch must always show ma+imum ambition to e+cite investors. &nvestors you meet will presume that your business can work. 2ou should never talk about selling your business. 2ou should always follow up the meeting to ask for a decision.

2.

3.

4.

5.

B. Discuss the following words and phrases from the text. What do you think they mean?

6.

survey target market

viable rivals

pro5ected acronyms

C. ook at the highlighted words and phrases in the text and match them to their definitions !elow:

;;;;;;;; < a planned series of actions for achieving

something.

;;;;;;;; < the total value of income received =revenue>

or sales over a given period.

;;;;;;;; < the care a reasonable person should take

before entering into an agreement or a transaction with another party.

;;;;;;;; < something you hope to achieve in the future ;;;;;;;; < someone employed to sell goods or services. ;;;;;;;; < the amount of money a company receives
after paying for operating e+penses, ta+es and all other and costs.

;;;;;;;; < the test form that a new design of a product

of it, which is used to test the design.

;;;;;;;; < the part of a business that someone owns. ;;;;;;;; < e+pansion of a business or pro5ect.