Start up Knowledge Series
Investing in startups is trending. But not all start ups are successful in getting the right investment partner for growth. No matter how great an idea, it depends on how start up entrepreneurs are able to successfully sell the idea to a potential investor. It is not the idea alone but smart communication of the saleability of the idea that changes the game.
Raising funds for business can be a daunting task for any wise entrepreneur. Every entrepreneur is likely to face a healthy dose of rejections.
In this edition for Start ups, we will look at broad guidelines and tips that can help a Start up build a winning business pitch and raise funds for future growth prospects.
While you plan to execute pitching of the idea to the investor, you need to look into the importance of research. Make sure that you are well-equipped with the required knowledge and planning thereafter to bring in action. Firms such as IBS take these points into consideration and provide your Business with services such as the Setting up of a Business entity in Singapore and the required registration services to ensure proper protection of the entity in any situation.
Things to note
While the entrepreneur embarks on a mission to garner financial support for his idea, it is pertinent to note some ‘to-dos’ and ‘don’t- dos’ that can impact a business pitch at the initial rounds itself.
- Keep short elevator pitch. You need to convey why an investor should love your idea in the first 5 minutes.
- Have a well thought out business plan to share, if investors want to delve into it.
- Be thorough with market research. Social page likes don’t translate total no. of users or customers.
- Avoid unrealistic promises about profitability, especially in short run as it can turn off investors
- Promoter background and experience could be an advantage but investors want to see a product that can stand on its own. It would be best to avoid leading investors with promoters biography than the idea itself.
- Above all, you need to be well-versed with your product and plan and what you are communicating to the investors
For better solutions in structuring and incorporation of Business, you will need to take an expert on your side who will guide you through properly, such as IBS Singapore, which provides valuable services of Business structuring and incorporation for your Business, that results in benefitting business with increasing growth and assurance of profit.
What investors look for in your pitch deck
Investors initially want to know what the start up is all about and whether it needs to be taken to the next level of discussions. Thus, the purpose of any pitch deck is to stimulate interest and not to bludgeon the investor about every aspect of the start up. Keeping this in mind, the recommended number of slides for a pitch deck would be 10 and can be stretched to a maximum of 15 slides if required. This limit will help organise the thoughts and focus on the absolute essentials for the pitch deck.
Ensure your pitch covers the following:
- Title slide that gives the company details
- Problem areas/opportunity that the product seeks to address
- Value Proposition of your idea – This could also include the secret sauce or the magic of your idea. Best demonstrated with pictures or prototype, if available.
- Business Model
- Marketing Plan
- Competitive landscape
- Management Team
- Financial Projections and key metrics. If you are the ideation stage, potential revenues to be shown backed with through market research
- Current status and Accomplishments to date
- Funding needs
To ensure that Your business ideas attract the investor, you need to take into consideration the interests of the investor. This can be achieved through expert consultant service provider, such as IBS which offers quality incorporation advisory services in Singapore, to help your Business expand across the limited boundaries
Startup entrepreneurs should remember that investors in all probability expect the idea to be similar or a derivate of the many ideas that they come across in the course of their business. The purpose of the pitch is to therefore present the investor with something they’d like to see. Nothing can be more frustrating for the investor than to be stuck listening to someone without a well thought plan. The goal is for the investor to be convinced that he gains from the new venture or partnership. In the end, it is all about – Whats in it for me?
This article is authored by A. Loganathan, representing India Business Solutions (IBS) which is a boutique advisory firm helping a lot of Start ups in India and Singapore in fulfilling their aspirations. Loganathan is heading the Singapore operations of IBS and can be reached on email@example.com Or visit our website at consultibs.sg