If you plan to get funding through angel investors or venture capitalists, you need to create an impressive elevator pitch to help your chances of getting approved. An elevator pitch is a short presentation that explains your business and track record. This elevator speech should sell your business to potential investors. A good elevator speech will help angel investors and venture capital determine if they should invest in your business or not.
Your elevator pitch should have an executive summary or full business plan that explains your business idea. Read on to learn the key components of an effective elevator pitch. By the end of this article, you should have a better understand on how to create the perfect pitch for a potential investor.
Explain What You Are Doing
Explain what industry your business operates in and what products or services your business sells. Angel investors and venture capitalists need to understand what you are doing to determine if they are interested in your business. You need to explain thoroughly what you are doing and why are doing it. This is a key factor and persuading potential investors to invest in your company. Elevator pitches should be around 3 minutes long, so everything needs to be concise and straight to the point.
Explain Your Experience
After you explain your industry and business, you need to start to discuss your track record. This includes information on the background and experience of the management team. It also includes the current profitability of the company if it is already established. The point is to make angel investors and venture capitalists feel like you have enough experience to be able to ask them for funding.
Explain How the Business Will Make Money
Angel investors and venture capitalists want to know how your business will make money, how profitable it will be, and how it will generate a return on their investment. Here you need to sell the fact that your business will be successful and profitable. You need to have a very good understanding of the financial and accounting aspect of the business to explain it perfectly. If you deliver this perfectly, you will have a high chance of having an angel investor or venture capitalist fund your business.
It is great to be enthusiastic and optimistic but remember to also be realistic. Angel investors and venture capitalists have a lot of experience so if you lie, they can probably tell. You need to be realistic when talking about what your business can accomplish in terms of profit.
The Bottom Line
The tips in this article can help you obtain the funding your business needs. Every investor is different and not everyone will require an elevator pitch, but it is important to have to present your business plan. If you have a well-established, well-managed credit history you will have better chances of qualifying for financing.