If you have a product idea that you'd like to bring to market, one of the first things you'll need is money. The good news is that there are plenty of ways to raise funding for your project—in fact, we've covered several in this very blog. But if you're going to go out and pitch potential investors, it helps to know what they expect and how best to set yourself up for success.
This post covers everything from knowing your audience (and them knowing theirs) to making sure your prototype is polished enough that people will take it seriously as a real business opportunity—even if they don't end up investing right away!
Know your audience.
Prior to walking into a room with an investor or group of investors, it’s important to know the background of each person in the room. Make sure you have some knowledge of the other companies they’ve invested in recently in addition to the fund they are a part of, their investment criteria, and the size of companies they typically target. It’s also important to know their investment timeframe regarding when they intend to invest and how quickly they typically want to see a return on their investment.
Keep your pitch short and to the point.
If you're not a natural salesperson and you don't have much time, this is especially important. If a section doesn't sound convincing or if it doesn't fit into the overall narrative, cut it!
Your pitch should be short and to the point. Don't waste time on details that won't help you get your points across. If you need to go into more detail about your product or feature set, save it for later in the conversation when they ask questions or show interest in certain elements of your presentation.
Know your numbers.
Knowing your numbers is the most important part of preparing for an investment pitch. This means knowing your costs, your revenue potential, and how to calculate both. It also means being able to explain all of this in detail to investors without getting lost in the details or forgetting a key point.
Bring a wireframe or prototype.
A wireframe is a visual representation of the user interface of your product. Typically, it’s created in a prototyping tool like Axure or Sketch. It shows what the pages look like and how they work as well as any interactions that can happen on each page.
You can use this to demonstrate how the user experience will work and also use it internally with developers when discussing design decisions or creating mockups for customers before development starts.
Be honest about your weaknesses.
When pitching a digital product, it is important to be honest about your weaknesses. You do not have to be perfect and you do not have to know everything, but being prepared with a team that can provide assistance when needed will help your pitch immensely. The goal of an investor is to find out what you need help with so they can tailor their advice accordingly. By preparing a list of areas in which you are weak, as well as those where your team excels, it will show investors that this isn't just something that one person came up with by themselves.
Talk about what competitors are doing wrong.
You should also talk about what your competitors are doing wrong. This will help you differentiate yourself from them and also show that you know your industry well.
Come with several different fundraising options in mind.
When you're pitching a product, it's important to come with several different options in mind. Depending on the investor and their portfolio, they might want you to raise money in a certain way.
If an investor is looking for a quick exit, they might invest just enough to get you off the ground and then sell their stake after one or two years (if things go well). This can mean more risk for them but also greater opportunities if the company does really well. If you're raising money from angel investors who want to get involved in your long-term success, there may be less pressure on doing something immediately profitable—but also less chance of seeing returns quickly as well.
You'll need to think about what kind of company you want and what kind of investors will best fit within those parameters before going into your pitch meeting!
Make sure the timing is right for you and the investors.
It's important to know your investor, their investment style, and the stage you're at with the product. As an entrepreneur, it's also important to understand your own investment horizon. If you're early-stage, it might be better to talk directly with founders who have recently raised money and are looking for follow-on opportunities.
If you're later stage, talk with investors that have already invested in companies similar to yours. The more experienced they are in your space, the better chance of getting funding for your business!
There are a lot of ways to approach fundraising for your digital product. The best way to prepare is by doing some research and coming up with a solid pitch that you can use no matter what kind of investor you're talking to. This will ensure that all your bases are covered and help you avoid embarrassing situations where investors ask questions that you don't have answers for! If you need help with preparing your pitch, prototype, or other fundraising materials, reach out to Camber Creative to work with our expert team.
Hexagon tumeric banjo bicycle rights. Deserunt commodo try-hard taiyaki marfa, live-edge cardigan voluptate pork belly hexagon laborum 90's poutine bespoke. Hella asymmetrical offal skateboard chia DIY actually mukbang flannel magna messenger bag 3 wolf moon letterpress minim coloring book. Voluptate vexillologist raclette pariatur vinyl. Post-ironic chicharrones irure jianbing incididunt mustache etsy organic PBR&B. Do cillum vaporware ennui venmo adaptogen cloud bread.
Sriracha tweed gatekeep ennui, messenger bag iceland JOMO magna in tumblr la croix.