As you’ve already learned, VC funding for your business doesn’t come easy…or quickly. Even once you think you have the right VC and you’ve made your approach to get their attention, the next step can get painstakingly long. I’m now talking about preparing to make “The Perfect Pitch”.
Take note that it can take some time just to get on a Venture Capitalist’s schedule…sometimes up to a couple months. You need to understand that just because you’re in a hurry, it doesn’t necessarily mean they are.
First things first: Unless your VC requests it, don’t send a full business plan; they won’t have time to read it. Also, at this stage, most Venture Capitalists are not going to have anyone sign a non-disclosure agreement. Therefore, you need to just give them enough information to pique their interest and have a good understanding of what you’re about.
The next thing your potential investor will want to see is your Executive Summary. This needs to be a “Killer”, while at the same time trying to get it down to a one-page document. Depending on the industry, this summary could be as long as three pages.
From this initial look at your Executive Summary, they will decide if they want to be pitched in person or possibly over the internet. You should be prepared for that possibility. Along with your Executive Summary goes your Pitch Deck…generally a PowerPoint presentation, which will aid them in their decision.
As you’re preparing your Pitch Deck, keep in mind that you want to try and keep your pitch to approximately 30 minutes, even 20, if possible. Try to stay within a range of 12 slides, only going longer if you have elements of your pitch that warrant more detailed information, such as prototypes. In this case, you could go as high as 30 slides.
There are eight touch points that need to be a part of your presentation. The first six are as follows:
- Intro – This slide should define your company, your product/service, and your Value Proposition; ultimately, tell them what it is you’re trying to do.
- Opportunity – What is the problem you are trying to solve and why should the VC pay attention to YOU; who are your customers going to be…primarily…and how big are the market segments (subsets)?
- Solution – Display and/or demonstrate your solution, why someone would want to use you, and explain why you are different. As mentioned above, this is when slides can go into more detail and get a little lengthier, if you have prototypes to show and explain.
- Business Model – This point is of utmost importance! How are you going to make money? What have you already invested to date and what have you accomplished? Provide a road map for where things are headed and what your growth strategies are once you’ve received funding.
- Team – This is where you identify your main team players and the strength of your management team; describe your team’s experience in the industry where you are “playing”. This will also help the VC know what it is they need to bring to the table.
- Competition – Who is your competition? Although you may not think you have competition, there undoubtedly is someone, whether a direct competitor or some perceived competition. In what way are you defensible?
I know…I promised eight parts to your Perfect Pitch, but have only given you six! In my next blog post, I will provide the last two components, outlining the MOST important part of your Pitch Deck. I’ll also discuss what due diligence on your part is necessary before all is said and done. Venture Capitalist funding for your business should now be coming into focus with this part of the process almost complete.