Top 10 Mistakes Entrepreneurs Make

When Pitching to Investors

hustlecowork.com

Entrepreneurs from early stage startups haveto pitch to investors to raise financing, andmany entrepreneurs are inexperienced orterrible at making the presentation. As aventure capital and angel investor who hasheard many pitches, I’ve compiled a list ofmistakes and things to avoid if you are anentrepreneur seeking angel or venturefinancing.

hustlecowork.com

Mistake #1: Sending executive

summary or business plan

unsolicited.

Investors routinely discard or don’t read unsolicited emails. They gethundreds if not thousands of such emails, and they can’t spend the timesifting through them all to find that diamond in the rough. But what they willpay attention to is a referral from someone in their network — a lawyer, anentrepreneur from one of their portfolio companies, or a fellow venturecapitalist.

hustlecowork.com

Mistake #2: Pitching your company

unless it’s clear that you are in a

space investor is interested in.

Some investors only care about biotech. Or mobile apps. Or clean tech. OrInternet and digital media. Do your homework first before trying to pitch meto make sure your company is in my sweet spot.

hustlecowork.com

Mistake #3: Giving a 50-page

business plan to review.

Give a 2-3 page executive summary and maybe a PowerPoint deck.

hustlecowork.com

Mistake #4: Not showing why the

market opportunity is big.

Most investors are looking for businesses that can scale and becomemeaningful. So make sure you address this issue right up front as to whyyour business can really become big. Don’t present any small ideas. If thefirst product or service is small, then perhaps you need to position thecompany as a “platform” business allowing the creation of multiple productsor apps. I will want to know the actual addressable market and whatpercentage of the market you plan to get over time.

hustlecowork.com

Mistake #5: Coming in with your team

to a pitch meeting,

but only have the CEO speak.

Investors want to know that you have a good team. Only having the CEOspeak at a pitch meeting is a mistake. How will the investor gauge whetherthe other team members are any good if they don’t hear them speak? Andplease don’t have the team members contradict themselves.

hustlecowork.com

Mistake #6: Not telling what

problem your business solves.

What problem does your business solve? Does it matter at all?

hustlecowork.com

Mistake #7: Forgetting to highlight

your team’s experience and

credentials.Many investors consider the team behind a startup more important than theidea or the product. The investors will want to know that the team has theright set of skills, drive, experience, and temperament to grow the business.Anticipate these questions:Who are the founders and key team members?What relevant domain experience does the team have?What key additions to the team are needed in the short term?Why is the team uniquely capable to execute the company’s business plan?How many employees do you have?What motivates the founders?How do you plan to scale the team in the next 12 months?

hustlecowork.com

Mistake #8: Not understanding

customer acquisition

costs and long-term value of the

customer.

What costs will you incur to acquire a customer? What will be the likelylifetime value of the customer? What channels will you use to acquire thatuser or customer? What marketing costs will you incur? What is the typicalsales cycle between initial customer contact and closing of a sale? Not beingprepared for those types of questions will hurt my perception of how wellyou have thought out your business plan.

hustlecowork.com

Mistake #9: Not understanding the

potential risks to the business.

There inevitably are risks in any business plan, so be prepared to answerthese questions thoughtfully:What do you see are the principal risks to the business?What legal risks do you have?What technology risks do you have?Do you have any regulatory risks?Are there any product liability risks?What steps do you anticipate to mitigate such risks?

hustlecowork.com

Mistake #10: Being unable to tell how

you will invest investment capital and

how long it will last.

Investor will absolutely want to know how his capital will be invested andyour proposed burn rate.

hustlecowork.com

Get in Touch12, First Floor, Hargobind Enclave Karkardooma. Delhi -92

9818819266

hustlecowork.com