What is a Business Pitch?
Business pitch can be deemed as a business plan that usually is presented to prospective investors for a start-up. It can be a kind of presentation by one individual or a team to a group of investors. It could also be in the form of an impromptu conversation, letter or an email even where the investors are explained their business opportunity and goals to convince them to invest. The main agenda behind a business pitch is to secure the funding and other resources to move ahead with a business plan or the business venture you are interested in launching. This pitch decides whether or not you get sufficient funds for your business to start. A shorter business pitch is called an elevator pitch.
What do the experts say?
Start-up investors like Alicia Syrett, founder and CEO of Pantegrion Capital, and Alex Kenjeev, president of O’Leary Ventures, share their best advice for entrepreneurs on how to pitch to investors.
- Don’t be too salesy. It’s a business pitch, and it’s a given that the entrepreneurs will pitch the investors for fundraising etc. and a lot of times the idea shifts from a pitch to an unnecessary pressure for them to make a decision, now. Please do not make it sound like it is an opportunity for them, and you are doing the favour by offering some amount of returns. The person or the group of investors are known to come across a hundred entrepreneurs and other start-ups on a daily basis, this pressure is not going to help you. It would only diminish the credibility of an entrepreneur.
- Sell, but do not oversell. Never say you have no competition. Do not underestimate or undermine other firms that are in the same field and industry as you. You share the same consumer base, and there must be some ethics followed. Stay honest and aware of the existing and potential competition without talking your way out of your pitch!
- Give them an investment pitch, not a product pitch. The investors are interested in business prospects and not your services or products. During a business pitch, a lot of time is spent on the features of the product, what you as an entrepreneur forget that the investor is interested in your company holistically. Along with your product or service, they are interested in the size of the market, competitive advantage, the team behind R&D, marketing plan, fundraising plans, and of course, the investment opportunities.
- Be specific. Do not pressure yourself on being a walking word salad. If you are trying every trick and gimmick to convince the investor; it is not working. Cut down on the thousand opportunities and ways to bring down others. It would be best if you present how you can be different during the business pitch. If you are not specific, your investors are only going to believe that there is nothing you can bring to the table.
- Pitch the deal, not the business. It is essential to put yourself in the investor’s shoes. The capital and the investment to be made is huge, and there is no guarantee if it is going to reward them or not. You have to win the investor’s trust by not only pitching the business but also the investment and how it is somehow going to profit them on XYZ terms.
- Be authentic. There is no better way than a business pitch to be straight forward with your investor. Of course, you will have the sales mode on, and you cannot give away all your weaknesses while the investors are gathering first impressions, but you need to clear on your company’s gaps and how and what are you’re doing to make it work or improve the situation.
How to get your morale set right before making a business pitch?
The way to a successful business pitch lies in confidence. There is the external confidence that you project which can help in closing deals, making friends, or making your project look inviting. Then there is internal confidence, that makes you feel and look comfortable under any circumstance or situation. Take a look
- Focus on a positive body language.
- Move around freely. Think of it as your time and place to get started.
- Make it clear in your head that it’s the people that have to work for your attention. Winning someone over can also be done in a pure relaxed mode. Flip the dynamics.
- Be nonreactive. Be prepared for a lot of questions and queries, but do not look pressured. Of course, show your emotions on positive terms but keep them in check.
Stay calm and collected, time feels 30% faster when you are stressed, so take your time to reply to your investors or else you are going to sound confused.
Airbnb’s original pitch deck from 2009 has become one of the most sought-after references for new entrepreneurs. It was one of the first pitch decks from unicorn companies to be released publicly, and it got a lot of media attention. The best part about this business pitch is that it was short, to the point, and it hits all the high notes, and most importantly, it perfectly paints the picture of the business. Take a look at the Airbnb Pitch Deck that raised $500K in 2009
- Cover- Simple cover slide with company name and tagline
- Problem-short, crisp, and to the point problems were discussed. They did not get into the market niche details as it might not have made sense to everyone. They chose to make the slide simple and thus, undebatable. Also, a big highlight is the key phrases and keywords.
- Solution-Notice how right after the problems, they have come up with solutions rather than pitching for their services immediately, they are onto proving their worth first. The headline is simple; no complicated tech jargon.
- Market validation-Although this slide is not necessary for every business pitch; for Airbnb, it was the key slide as it showed how people are shifting away from the hotel set-ups. People are looking for cheaper travel accommodations and are also willing to share.
- Market Size- this slide seals the deal on the opportunity for the investors by declaring your market size.
- Product-showcase your product screenshots; without it, there is no business pitch. A 20-30 seconds video instead of a hundred screenshots would also do the trick.
- Business model-this slide is significant so as to assume an ambitious and a bold piece of the travel market. A clear idea and straightforward information on business dimensions.
- Adoption Strategy– the idea behind the slide is that there is a plan, and there are backup plans in the making to grow the company without recruiting an additional team of agents. The dual posting feature on Craigslist was one of the Airbnb’s most iconic marketing hacks. Genius.
- Competition-To show what makes you different and competent is what the investors are looking for. Airbnb proved to the investors that their online transactions and affordability etc. set them apart.
- Competitive Advantages– This is another fantastic way of presenting game-changing ideas and of course, execution. It’s what makes the pitch valuable. It’s a smart way to answer the questions before they are even projected.
- Team-This slide was again, clear and not too detailed. Only the founding team are highlighted who obviously 100% are appreciative of the entire team.
- Press-Your credibility needs validation. Showcasing your features is a brilliant move.
- User testimonials-Testifies for itself.
- Financial– the final slide, or the details of the fundraising efforts. Again, to the point, with a clear goal of targeting 80,000 transactions.
- Always begin with an elevator pitch.
- Aim for a realistic presentation.
- Be responsible for every penny that you ask for.
- Always highlight the business opportunity.
- Do not oversell.
- Analyze the competition and focus on what sets you apart.
- Always share and explain your marketing strategy.
All in all, it is imperative that you have the right approach during a business pitch. It is a challenging move, but if done systematically and ethically, it is undoubtedly going to be a fruitful one.