How to survive a Dragons’ Den: 7 keys for a successful pitch
At various stages in the life of a business it may be necessary to secure external funding. This support might be needed to finance its operations on its way to becoming viable, or to grow or expand it from its current size or focus. Invariably, the entrepreneur must pitch his/her idea to prospective investors in the hope of receiving much needed support. However, delivering a pitch can be a nerve-racking affair, since ultimately, the life of the business is at stake. This post offers some advice on preparing for such an event, but please fell free to share your own experiences and observations in the Comments section.
1. Develop your pitch. Being prepared for the opportunity to present your business (or business concept) is key. It is recommended that pitches be prepared at different lengths and to suit different audiences. Also, consider the aids that you might need – a presentation programme; audio/visual tools – and even being able to discuss your idea without such support.
Further, it is at this time that the mechanics of delivering a solid pitch should be fully explored and perfected. This would include ensuring that your pitch is coherent; that it highlights the salient points of your idea or business; and that it engages your audience. At the end of your session, you would want people to be excited about your idea and to begin to see its potential.
2. Gauge your audience. In order to figure out what pitch might be appropriate to deliver, it is crucial to know who your audience is. Are you in a room with Venture Capitalists? Angels? Your bank manager? Depending on the situation, you might have only a few minutes, based on the introductions made, to figure out how best to make your pitch. If the audience is a mixed bag, then it might be safest to align your content to the type of investor you are looking for.
3. Know what (how much) you are asking for. As part of your pitch, it is important to communicate what level of support you are looking for. This point suggests you have done your homework and know how much it will take to get your business where you want it to be. Additionally, at that time, do consider giving some indication of the share of the business you are willing to part with to get the desired funding.
4. Have a strategy to make the business viable. This point can be a particular challenge to tech businesses, especially those based on mobile applications or on social media or developing a following. Viability, should be based on a well conceived strategy; should be produce reliable and measureable results; and should be highlighted in the pitch. Many tech entrepreneurs do not consider profitability from the outset, or even whether the business can break even. Hence invariably they find themselves having a successful product in terms of customer base and use, but receive negligible revenue from the venture, and do not know how to leverage their market to their advantage.
5. Show some sweat equity. It is important that you, as the entrepreneur, are seen to have invested time, energy and/or money to develop your business. There should be some demonstration of your effort and personal commitment to the business. It ought not to be the case that you are hoping to risk other people’s money to get your business off the ground, and are just trying to sell an idea. At the very least, you as the business owner should have something to show, such as a demo of your proposed product or service, if it is not yet being fully implemented.
6. Demonstrate some success. The further you are along the path of implementing you idea, the better your chances of securing support. If you already have a product (or service) on the market, have already developed a customer base, and can demonstrate some measure of success with the business, investors will more likely be open to considering your idea. Having a track record that can be referenced can foster greater confidence in the venture.
7. Play devil’s advocate. Depending on the session, you as the presenter might be required to field questions from the audience. As part of your preparation, it would be useful to consider some of the challenges or problems that you could be asked about. Family, friends, associates, etc., could assist by critically examining your idea and trying to find weaknesses in your pitch. This will help you not only to strengthen your pitch, but also help you to test the robustness of your concept or venture.