Pitching a business to an investor is often the most important moment in an entrepreneur’s professional life. In a matter of minutes or even seconds, an entrepreneur must convince investors that they, and their startup, are a bet worth taking—a tough task within the high-pressure, high-competition arena of venture capital.
The value of preparing a good pitch is more than just getting a foot in the door. It also helps budding entrepreneurs pinpoint exactly what their business does, why they’re different from the competition and where they want to take it next. To prepare you for this crucial moment, we teamed up with BMW and the Hot Lap Pitch to show you how to sell your idea in 60 seconds and take your business from launch pad to orbit.
Show passion. Fast. (0 – 20 seconds)
Investors hear many pitches every day and are often pressed for time, so you should seek to pique their curiosity right from the start.
When making a pitch, being passionate about your company is the first hook to an investor. Make sure to present your idea with the same fervor and devotion you have for your business, and avoid vague statements like “the potential market size for this sector is…” as these do more to detract than attract an investor’s attention.
The first part of your pitch should be all about your idea. Why do you love it? Why is it worth pursuing? And if the business is up and running, how much traction has it gotten so far?
If you can answer these questions in the first 20 seconds of your pitch, you’ve already gotten past the hardest part, which is capturing an investor’s undivided attention. Now that you’ve cast your lure, it’s time to reel them in.
Know your numbers, inside out (20 – 40 seconds)
When making a pitch, numbers are crucial. However, don’t rush to dump all the statistics that come to mind. Instead, focus on the numbers you think are indispensable to your company’s story, the ones that immediately capture an investor’s attention.
The most meaningful stats to include are those that show traction: Sales figures, profit margins, growth rate, or even customer acquisition costs. If one or many of these general financial figures interests the investor have no doubt, they will ask for more. If that happens, be prepared to discuss in-depth details such as cash flow, inventory management and more.
In short, the middle section of your pitch should prove that you’ve done your homework and are prepared to respond to any twists and turns that come your way. This is key for investors, as they want to make sure their money is going to someone who will give the same attention to detail to future business decisions as they have for the business pitch. After all, would you want to give your money to someone who hasn’t left any stone unturned?
You are your business (40 – 60 seconds)
Once you have done the work and explained why your business deserves a chance, dedicate the last 20 seconds to speaking about yourself. Remember, an idea can be great, but it is only an idea until it’s executed, which depends entirely on you.
This is when you switch gears and pitch yourself, to convince the investor that you are the perfect person to build this business.
Investors love entrepreneurs who are able to show a personal dedication to their startup that goes beyond making money because it shows they will be in it for the long haul. They aren’t just betting on your idea, they’re also betting on your ability to execute it. To solidify the investor’s commitment, be ready show why they should trust you and the sacrifices you’ve made—and are willing to make—to guarantee success.
Demonstrating that you’re the best person to lead your startup goes a long way in making a positive impression, which can often be a determining factor that turns an investor’s ‘maybe’ into a ‘yes.’ A genuine passion and drive should come through in every word of your pitch.
By the end of your pitch, your investors should have a complete grasp of what your business is about, what its financials are and who you are as an entrepreneur. Now all you have to do is to take a deep breath and let the investors decide if they want to go along for the ride.