However, no matter the size of the start-up, they all have the same common problems when it comes to pitching their concept.
With this in mind, I have made a list of the most common pitching mistakes we have seen.
I have no idea about numbers
Listen. No matter how amazing, how fantastic or revolutionary your product is, if you cannot demonstrate hard, realistic numbers then forget the idea of investment. Here are the questions you need to answer:
- what is the price point
- what is the profit margin
- how many units can you sell
- what are your projected costs
- what have you sold so far
"We want £500k for 5% investment, we think this is a fair number". Is it really?
When you are pitching your concept you need to convince the investor that they are going to be buying into a massive return. If you have a turnover of £10,000 per year do not expect to pitch on a valuation of £10m and not be laughed at. Be realistic and be honest.
your money is for me, and only me
Your software is your investment, not the investors. They are handing over thousands of pounds in the sincere hope you are going to turn their tens of thousands into hundreds of thousands. They are entrusting you to grow the business, not put the money into your pocket.
this money you are going to invest? I need it tomorrow
Timescales which include "ASAP", "this quarter" or "now" show a clear indication that you have simply not prepared the business for funding. Create a roadmap of how the funding will be spent, where it will spent and show real costings.
That's the end of Part 1. Check out Part 2 next week!