Guides

What Are Investors NOT Looking For In A Pitch?

Business women talking at a meeting

You need to be prepared for rejections when you pitch to an investor.

The UK counts over 15,000 angel investors for over 5.6 million companies. In other words, there is no such thing as one investor per company. Besides, more often than not, investors can team up to support similar businesses. As a result, they tend to focus on a limited number of projects. Investors select between 0.5% and 2% of the total number of pitches they receive. 

Therefore, it is vital for businesses seeking investments to understand how to appeal to their audience and raise funds for growth. Preparation is not everything when it comes to convincing investors. They expect every business to present compelling and accurate financial forecasts, business strategies, and points of difference. But businesses that do the following have a higher chance to make it to the lucky 0.5%. 

Don’t be a stranger

Each investor has unique interests and objectives. Pitching to a group of potential investors is a waste of time if you don’t do your research to understand whether they are a good match for your company. You need to make sure investors already know about your brand. Building a network of contacts and mentors within your industry can also help you get to know and get knowns by individual investors better. Your contacts can prove useful in securing a first line of contact with investors, as cold calling is unlikely to be effective. 

Additionally, working with experts and advisors in the industry can be instrumental in positioning your business and demonstrating your credibility. 

Bring an analysis, not just an idea

Great business ideas don’t change the market because nobody invests in an idea, and that’s precisely the role of business forecasts. However, business forecasts are unpredictable by nature. According to studies, sales forecasts are less than 75% accurate, which means that there is a margin of over 25% of error. Investors are aware of the risk of overly optimistic forecasts. 

But a business can support its forecast figures through detailed and thorough data analysis, highlighting opportunities for improvements within the business. Data consultancy experts at The Oakland Group, for instance, have a long experience in data analysis and data solutions, enabling them to unlock new and meaningful insights. When forecasting remains an unreliable science, pairing your results with scientific data convince investors to accept your expected growth. 

Don’t let confidentiality fears get the better of you

Pitching to investors is not the same as preparing a product launch for your audience. Investors need and want to know the details of your product or service concept if they are going to support your idea. While many entrepreneurs automatically ask potential clients and applicants to sign an NDA, the same principle doesn’t apply to investors. Investors are typically looking at multiple deals simultaneously, and NDAs can create legal issues and affect your chances to secure investment. 

Additionally, investors are not interested in stealing an idea. They seek entrepreneurs who can build a successful business model using a great idea, business know-how, and strategic skills. If anything, an NDA signals to investors that the entrepreneur underestimates the effort and work involved in creating a business. 

Avoiding these costly faux pas can help your business build a positive relationship with investors. Indeed, you have a limited time to convince investors during your presentation. Therefore, maximising your chances by boosting your brand network, forecast figures, and business strategy can make a huge difference. 

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