How to Pitch your Proposal to Investors

Investors will not take you seriously unless you have a business plan. View a plan outline for guidance.

The whole process of starting a business begins with writing the business plan. (View a business plan outline for guidance). A good business plan is the key to a successful business. Once the plan is in place it needs to be adapted to achieve the correct pitch to approach Investors.

Create a professional Pitch

You must remember that the investor has extensive experience in their area of interest. Nevertheless you should still educate the investor on your product's market potential and provide a simple, straightforward presentation with minimal use of technical language. Investors are willing to support companies or entrepreneurs who have a potential market. Hence it is highly important for you to demonstrate the size and potential growth of your company by referring to analyst reports and market research and most importantly discuss revenue streams and potential pricing models including licenses or potential partnerships. You can also mention information about the service providers such as accountants or law firms to enhance your credibility. The investors are generally of the view that if a company is working with another experienced organization then it would have gained quality advice before seeking funding. Commonly, companies ask for finance to last for six months before making plans to raise money later. This reduces the company's chances of surviving in the long term and is a mistake best avoided. It is considered wiser to view funding requirements on an 18 month timeframe.

Increase Your Chances at Getting Funded By Targeting the Appropriate Investor. You should analyse your industry and approach Investors who share the same interest and are equally passionate to make changes to that particular industry segment. Experts in your sector are invaluable mentors with useful contacts in the field.

Write Winning Proposals

Every investor views the entrepreneur's project as a pure investment and wants to know if they will get a good return on their investment. The business plan should be investor focused and should contain relevant information about your project. The plan should address the investor's concerns and provide solutions which would meet their specifications exactly. Four key areas that needs to be addressed:

Four key areas that needs to be addressed:

Management
The strength of management assigned to the project can make or break your proposal. The investor needs reassurance that the entrepreneur can manage their money.

Target Market
Your company must demonstrate a strong understanding of your customer base. Your plan must address any potential new or growth markets.

Your Product
The investor will want to fully understand your product. You will be expected to demonstrate how the product that they are funding will attract customers. The information in this section must be extensive and also feature any potential expansions or upgrades that your product will feature.

Revenue Model
Explain how the team will link the product to the market to achieve positive cash flow.

The investors should be assured that there is a good reliable group of talented individuals who can execute the work in an accurate manner. When introducing the team to the investors, you should focus on mentioning any significant achievements of each person that would help in identifying that person as a winner. Give a concise description of the roles and duties of each team member. The investors are interested to know details of how the work would be accomplished.

Make the investors appreciate how the solution provided by your company would work in the target market. Impress them with your ability to make a complicated task look easy. Convince the investor that your product or service has the ability to attract different market segments. This will be self explanatory if you have proof of customers who have expressed their interest in your product/service. Set short term and long term milestones to show the investor that you have thoroughly planned your company's growth and accordingly assessed the funding you require.

Every entrepreneur that aims to start a business and build it into a successful enterprise has to observe market trends and identify a better or unique way to fulfill the needs and wants of people. It is a well known cliché that an entrepreneur is a person who is ready to take risks and face challenges to make a business grow and flourish. Thus innovation and risks are the two basic elements of entrepreneurship.