A key to success in pitching SmartMoney investors is how you prepare. Once you’ve built your target investor list and scheduled a meeting it’s time to do some serious homework.
When you’re in a meeting with the sharks, it’s not enough to just have your pitch down cold. That’s a given. You also must prove that you’re smart enough to know as much as possible about the the investment firm, their portfolio of investments and the background of the people attending the meeting.
Here’s just a few of the facts you should know:
- the size of their fund
- when they last raised money
- the most relevant portfolio companies that compare to your business
- any recent IPO or M&A transactions
- the bios/backgrounds of each person in the meeting
Be sure to search SlideShare to see if the lead investor has posted any presentations. If they have, review them so you know what their hot buttons are as well as their general view of the industry.
If you go into the investor shark tank with this background knowledge, you’ll impress the investor with your preparation. That sets the stage for establishing trust and confidence in you, and by extension, in the opportunity you represent.
To be sure, it will put you in a whole different category from most people that come in and pitch them.
I describe how to find the right investors in the SmartMoney Playbook. It’s free, and you can grab it here.
In the old days (a decade ago) it was challenging to know the first-hand views of an investor you may not have known personally. Today, it’s easy. Just subscribe to the Twitter feed, Facebook profile, and blogs for the partners and the firm.
Read the posts to see what they care about and their views are of relevant topics in your industry.
Raising Money is a Two-Way Street
Just as investors will ask you questions, you should come prepared with a list of questions for them. Remember, a pitch meeting is a two-way street. Just be sure to not ask questions that they’ve already answered online or in public. That’s annoying and a poor use of your time, and theirs.
Your job is to stand out by asking insightful questions that make them think about your industry or customer problem in a unique way. Come up with an important question or opportunity that they haven’t addressed in public.
One way you can do this is to talk with some of their portfolio CEO’s in advance and do some scouting.
I was in the Marine Corps before becoming an entrepreneur. A critical lesson we learned was this: the strike teams that go into hot zones without doing their homework usually don’t survive.
Too many entrepreneurs go into the shark tank without doing their homework on the investors who will be judging them. As a result, the entrepreneurs usually walk out with their egos crushed after a failed pitch.
I don’t want that to happen to you.
I want you to walk out of the meeting feeling great and talking about a potential term sheet. So, do your homework before the meeting and you’ll stand a much better chance of emerging from the shark tank with a potential deal.
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