Investors are tasked with sifting through stacks of materials to decide which lucky founding teams get the opportunity to pitch to them. Not only is it an uphill battle to design materials that are strong enough to get you in the room, but it’s even more challenging to lock in the funding once you’re in the room and tasked with telling your story face to face.
In order to stand out from the crowd, you have to do your research to really understand what it is that investors are looking for so that you don’t waste your opportunity after working so hard to get into the room in the first place. So, what are some things you can do to give yourself the best chance of locking in venture funding? Here are a few tips to get you started.
The first step in capturing an investor’s attention is to develop a clear and concise elevator pitch. The concept of an elevator pitch is simple — provide a quick overview of your venture idea and the reason it’s essential to bring it to life. It’s called an elevator pitch because it’s meant to be a fairly short pitch, such that you’d be able to convey your idea while riding on an elevator with someone.
So, what makes a good elevator pitch? Well, first you need to find a good hook. Ideally you want a hook that will connect with the individual that you’re pitching to so that they are immediately engaged. The hook should be centered around the problem so you can then transition to providing an overview of the solution you are working to implement. Keep it simple and focus on nailing the conceptual link between the problem and the solution.
In order for a mobile app to ultimately be successful, you need to place a relentless focus on getting the user experience just right and creating a digital environment that your users will keep coming back to. When you just tell the story behind your app in words, it can be difficult for potential investors to truly understand the execution of your vision.
Through creating a visual representation of your app idea, even if it’s in the form of detailed mockups or wireframes, it can help the investor to grasp the visual story and better understand the user journey. Whenever possible, try to use rich imagery to visually showcase the essence of your mobile app idea rather than telling investors what you’re planning to do. This can really help to bring the narrative to life.
One of the key factors in mobile app success is understanding who in fact your target audience is and which types of individuals you believe will be your most loyal repeat users. Investors want to see that you have a good idea of your ideal consumer profile, which will help you target your marketing efforts in the long-run and ultimately build the product with this individual in mind.
In order to effectively define your target audience, start broad and narrow in on a more niche audience over time as you collect actual app data post launch. When broadly defining your target audience, specifically pre-launch, try thinking about what problem you are trying to solve and who might benefit from the associated solution that you’re working to build through the creation of your app. To the extent that you can do some consumer insights research to test your hypothesis and validate your value proposition with your intended target audience pre-launch, this will help investors to feel confident that you understand who it is that you’re building the mobile application for.
When you get into the room with an investor or group of investors, your pitch deck will be your visual guide to help you tell the story that you are in the room to tell. Not every aspect of your written story needs to be physically on the pages of your pitch deck. Rather, your deck should be visually appealing and should serve as a complement to the verbal story that you will tell when you get into the room. If all of your text is on the pages, there’s no need for you to even be in the room! Leaving a component of the story off the page will leave you the opportunity to really bring it to life.
There are several key components that you’ll want to include when building the pitch deck that you intend to use for a fundraising round. First, you need to make sure you clearly articulate the problem and the solution that you’re developing. Then you should detail your target market and provide a visual depiction of the mobile app you’re working to build. Include anything you can to demonstrate the company’s growth potential which will help you get investor buy-in. Provide an overview of the founding team and include a slide that outlines your key competitors and how you will differentiate your app. Finally, provide financial projections if possible in addition to a slide outlining how much money you’re asking for and what you plan to use that money for.
Rather than spending the entire pitch meeting telling the investors what you’re planning on building, they want to see that you’re doing all you can to show them what you’ve already built and what you plan to develop. In some cases, this can be a bit of a chicken-egg problem: you need to raise funding to build your product but you need to show that you’ve made enough progress on your product in order to actually raise the funding. While the ideal situation would be to bootstrap to the extent that you can develop a basic MVP prototype to show investors in the room, it’s not always feasible.
In this case, the next best thing is to try to show them detailed wireframes or visual mockups of the user journey so that you can try to bring the user experience to life for the investors as much as possible. Showing the investors what you can about the design and layout of your mobile app will help them more explicitly understand your vision and will make the value proposition feel less abstract. The more you can show versus tell investors about your product, the more likely you are to get investor buy-in, assuming that you have a well-articulated value proposition and product idea in the first place.
One thing investors don’t want to see is that you don’t even know how much funding you need in the first place, nor do you know what you’re actually planning to do with that funding. Rather, you should utilize the end of your pitch deck to explicitly tell the investors you’re pitching to how much money you’re asking for and what you need the money for in order to take your business to the next level.
If you’re working on building an app-based business and already have some iteration of your MVP in hand, you’ll likely need to use a substantial amount of the money raised for resourcing so that you can maintain and continue to update your existing features and can work towards the development of new features. Depending on whether or not you’ve launched publicly yet, you’ll also need funds to establish and execute your go-to-market strategy and to market your app so that you get it into the hands of the right consumers. In order to show rather than tell investors what you’re going to use the money for, it’s great to show them mockups of the subsequent features you’re planning to develop following the launch of your MVP.
Compiling the right set of materials that is necessary to raise funding can be quite an overwhelming task. You often need to develop a clean one page summary document, do extensive research to understand the types of investors you should be reaching out to, and design a killer pitch deck. These things are often needed just to get your foot in the door to the extent that you can get into the room.
Once you actually get in the room with the investors, you need to make sure you’ve packaged a compelling story and have the capacity to effectively deliver that story in order to secure the funding you’re seeking. If you’re new to the fundraising process and going at it for the first time, or if you’re a fundraising veteran looking for an extra hand, our team of audience and revenue experts can step in wherever you are in the fundraising process to help you craft a compelling story and to get that story in front of those who can help you take your venture to the next level. Our team can also go beyond this to do a product strategy immersion that delivers the wireframes, budget, and roadmap that you can present to investors to significantly increase your chances of winning the funding that you’re looking for.