I have yet to meet a founder who knows how to pitch their company so that it immediately resonates with investors.
Your first job, in 10 seconds or less, is to give me the one golden nugget that makes me want to learn more. The most common mistake is talking about the product or technology or the company before I care. And I won’t care if you can’t convince me there’s an opportunity for me to make lots of money by investing.
BAD: Mobile social marketing loyalty program software
GOOD: Increasing profits & user engagement for mobile app developers
Your next job is to double-down on why I should invest. There is no formula for this. You have to get out of your own head and into the mind of the investor. Here are the three most important factors angel investors care about, in priority order:
- Social Proof: Has someone I trust invested? Did they do their own diligence and negotiate the terms with you? Are you offering me the exact same terms?
- Scarcity: Is my opportunity about to go away if I don’t act now?
- Speed To Liquidity: How soon before I get my initial investment back at the very least?
Did Tim Draper just invest in your round? Is the round oversubscribed and you will only accept my investment if I sign right now? Are you sharing a portion of your significant monthly revenues with your investors effective immediately?
If any of these are true, then I probably don’t need to know anything more. The reality is that I’m either already sold, or you will never close me anyway.
Every fundraise is unique and has unique golden nuggets. You can’t change the fundamental quality of your deal quickly, but you can change your pitch immediately so that I see it in the best light possible right away. Here is a pitch deck template to help you get started.
I’ve been an active angel investor and entrepreneur for many years, and I’ve coached thousands of founders on how to improve their pitch. Since starting Crowdfunder, I’ve seen companies with zero traction for months on end change their pitch and close hundreds of thousands of dollars within a couple of days.
Equity crowdfunding can be transformative for fundraising entrepreneurs, but the transformation begins and ends with the right pitch.