To gain first-hand perspective on the key elements needed to successfully pitch a business to investors, we spoke with Deepak “Dee” Agarwal, an accomplished entrepreneur and business, on the crucial elements driving investor buy-in and financing.
Atlanta, GA, 16th June 2022, ZEXPRWIRE, Let’s say you’ve got a great business idea. You’ve done your research, drawn plans, and created a prototype. Now, you just need the money to get started — which means finding investors who believe in your vision and are willing to help you grow your business. A recent study conducted by Harvard Business School professors found that businesses with seed investors are four times more likely to achieve profitability than those without. Without investor buy-in, it is likely that your business will face more challenges and roadblocks along the way. So, how do you get investors on board?
Pitching is the art of presenting a business idea to potential investors in the hope of securing funding. Staring down a room full of people who potentially hold the fate of your business in their hands can be a nerve-wracking experience, but there are proven ways to prepare and increase chances of success. To gain first-hand perspective on the key elements needed to successfully pitch a business to investors, we spoke with Deepak “Dee” Agarwal, an accomplished entrepreneur across multiple industries and business endeavors, on the crucial elements driving investor buy-in and financing.
Have a Plan
This may seem obvious, but it’s critical and worth repeating. The first and most important element of an effective pitch to investors is a solid business plan that covers a totality of objectives, actionable steps, analysis, and logistics. Take time with every detail and cover every contingency. Solicit as many voices as possible to evaluate and to poke holes in the plan. Walking in the door with a comprehensive business plan will underscore an entrepreneurs’ seriousness, credibility, preparedness, and passion.
To construct a robust business plan, be sure to include an executive summary, overview of products and services, marketing strategy and analysis, and financial and budget forecasting. Be sure to put yourself in the mindset of a potential investor and answer questions they are likely to poise in the business plan.
“Far too often, entrepreneurs engage investors with a half-baked proposal that’s barely more than an idea,” explained Dee Agarwal. “An extraordinary idea without comprehensive financial projections and actionable steps for using that investment is not really an idea at all. Before they put their money anywhere, investors want to see a clear roadmap for receiving returns on their investment.”
Have a team
Investors will want to see that there is a strong team in place to help actualize the corporate vision. Investors are likely to evaluate if your team has the right mix of skill sets, experience, and passion, as well as a collaborative synergy.
Any startup is likely to face unexpected obstacles or deviations to their original plan, making the core leadership team critical to success. Experience and knowledge of the industry are necessary, but commitment and dedication are also essential, especially in times of scaling or uncertainty.
“Investors know that a business plan or idea is only as viable as the team that is there to execute,” says Deepak Agarwal. “When putting together your team, it’s just as important to find individuals that share your passion and enthusiasm for the business, as it is to find those with expertise in the industry. If your team is not fully bought into your business, investors and customers won’t be either.”
Investors will want to see evidence that an idea has potential and a clear path to profitability. How much will it cost to get the business up and running? How long will it take to become profitable? A business’s current and predicted financial situation should be outlined to present a clear direction for growth and profitability in respect to revenue, costs, and cash flow.
“Having a financial model to define your businesss predicted costs, growth rates, and profitability will be important to show investors that your ideas aren’t just pie-in-the-sky pipe dreams,” noted Deepak Agarwal. “Investors are motivated by the bottom line.”
While every investor has their own criteria for evaluating potential businesses, entrepreneurs must strive to present their ideas and plans with clarity and precision. Investment in preparedness and planning for the pitch is key to driving investor interest in your business.