Investor meeting tips

For many startups it’s impossible to grow without an investment from an angel investor (informal investor).

Getting an investment from an angel investor is an exciting process, which usually requires several meetings. It starts off by sending the angel investor your pitch deck. If the investor likes your concept, you should be able to get the first investor meeting.

Here at PitchSkills we’ve been to many investor meetings and here we’ll share the most important investor meeting tips.

First of all, the goal if your first investor meeting is not to get the investment.

It rarely happens that you close a deal with an investor during the first meeting. Usually it takes a few meetings to discuss everything the investor wants to know. Therefore, the goal of your first meeting is to get that next meeting.

´The goal of your first investor meeting, is to get to the next meeting’

 The 12 things you should do for your next investor meeting:

1. Do your homework
2. Have your documents ready
3. Prepare for tough questions
4. Send a teaser or your pitch deck up front
5. Be on time and be well dressed
6. Know your split
7. Know where the money is going
8. Be open for criticism
9. Be honest about everything
10. Sleep well
11. Don’t ask stupid questions
12. Follow up

 Without further ado, let’s get into the investor meeting tips.

#1 Do your homework

When you meet an investor, it’s important to know more about the investor’s background. Use Google, LinkedIn and Twitter to learn more about:

• The area of expertise of the investor
• Previous companies the investor worked in
• Companies the investor founded himself
• The interests and hobbies from the investor

#2 Have your documents ready

If you want to impress an investor (you should), you should have all your documents prepared. Documents you should prepare:

• Financials
• Pitch Deck
• Business plan
• Resumes of your team members

Probably you won’t discuss of these document during the meeting, you might not even discuss one of them. However, when an investor wants to know more about any of these documents, it looks really sloppy if you don’t have them.

If possible, print all of these documents and bring them to the investor meeting.

#3 Prepare for tough questions

Investors are usually smart people. Quite often, they have founded companies themselves and they know what they’re talking about.

Because of their experience they’ll have an easy time to spot the weak points in your business concept. When they do, be prepared for tough questions on these weak spots.

You must realize that it’s their own money they’re investing, so they want to know every detail about your company before they invest.

#4 Send a teaser or your pitch deck up front

Before you meet with the investor it’s recommended to send a pitch deck or a teaser up front. Not only does this help the investor to understand what your startup is doing, it also increases the quality of your meeting.

#5 Be on time and be well dressed

This is an easy one, but some entrepreneurs still forget it. Never be too late for an investor meeting and never be under dressed.  This doesn’t mean you should be in the most expensive suit you got, but at least go for smart casual.

#6 Know your split

Investors are always interested in the division of shares within your startup. This is because they want you to have a fair amount of shares. Why, you ask?

Investors hate when a company gets a few rounds of investments and the founders are heavily diluted. Their biggest fear is that you have little shares left and you are unmotivated to work for your own company.

#7 Know where the money is going

Let’s say your company is looking for an investment of $250,000, -. Being an investor, you want to know where this money is going. Is it going to sales and marketing? Or does 80% of the money go to ski trips and a fancy office?

Present the investor with a nice overview of how you’ll spend the money. If the investor asks for it, you should even be able to explain how each budget (f.e. marketing) is divided.

#8 Be open for criticism

For many entrepreneurs, this is a tough one.

Your startup is your baby and you hate it when people are ‘negative’ about it. If that’s the case for you as well, I’m afraid I have to warn you:

Investors will have criticism.

If that’s the case, don’t worry, it means they’re being honest. If they wouldn’t share any criticism at all, it would mean that they’re not interested and want this meeting to be over with as soon as possible.

´It’s great when you get criticism from an investor’

#9 Be honest about everything

When you’re an entrepreneur, it’s tempting to make your company look a bit bigger than it actually is.

Please don’t do this, the investor will find out.

When the investor decides to invest, most likely there will be a due diligence. In this case, they’ll get to know all the ins and outs of your company. If it turns out you have been lying about certain aspects, this could break your deal.

´Never lie to an investor’

#10 Sleep well

Investors are smart people and they will fire tough questions.

If you’re in the investor meeting and you’re feeling sleepy, there’s a high chance you’ll screw it up. Investor meetings intensive and you better be prepared for it.

#11 Don’t ask stupid questions

When you’ve signed a deal with an investor, it’s okay ask (personal) questions. However, when you’re in the first few meetings, stay away from asking stupid questions. Thins you should never ask during an investor meeting:

• Don’t ask the investor about the size his fund
• Never ask an investor to sign an NDA
• Don’t ask the investor how long it will take to close a deal
• Don’t ask the investor for his opinion on your company
• Don’t ask the investor about other investments

Of course, when the investor starts about on one of these topics, it’s fine to talk about it. Just be sure you’re not the one to bring these conversations up.

#12 Follow up

After you’ve had the first investor meeting, it’s time to follow up. There are a few ways of doing this:

• Connect with the investor on LinkedIn
• Send the investor an email
• Give the investor a call

All of these ways have one goal, which is to get to the second meeting.

Good luck with your second investor meeting!

5 interesting articles from the pitch blog you should reed this week

If you’re a regular reader of the pitch blog, you already noticed the articles listed below. However, if you’re not, make sure to check out these 5 articles.

At PitchSkills we’re 100% confident you can use them to improve your pitch. In case you haven’t done so, bookmark the Pitch Blog to your favoutires. 

#1 – 8 Things Steve Jobs Can Teach You About Pitching

We all know Steve Jobs for his famous ‘reveal’ pitches. Steve Jobs introduced many products with a pitch, including the ipod, iphone and ipad.

Every time when Steve Jobs did a reveal pitch, the crowd would leave the room excited.

There are a lot of pitch lessons you can learn from Steve Jobs.

[Read further..]

#2 – How Well Timed Silences Can Improve Your Pitch Drastically

After many pitching competition and countless hours of pitch coaching, I can say that this is one of the most effective tools you can use.

Every now and then you should hit pause in your pitch.

[Read further..]

#3 – 3 Methods You Should Use To Start Your Pitch

During the opening of your pitch you should only have one goal in mind: Get the attention of your listener. Research shows that the first few seconds of a pitch will determine whether somebody will pay attention to the rest of it.

There are a few ways to get the attention of your listener.

[Read further..]

#4 – How You Should Design Your Pitch Slides (even if you’re not a designer)

Many people who pitch, back their story up with a presentation. This presentation usually consists of slides which summarize the points they are trying to make.

If you are one of those people, please stop.

[Read further..]

#5 – Stop being scared of public speaking

Are you afraid of pitching? Or are you afraid of public speaking in general?

That’s okay, many people are. There are four main reasons why people are scared to pitch:

#1 I don’t like to be in the center of attention

#2 I am not confident with my looks

#3 I can’t stand all these people staring at me

#4 My voice is ugly

[Read further..]

Are you afraid of pitching? Or are you afraid of public speaking in general?

That’s okay, many people are. There are four main reasons why people are scared to pitch:

#1 I don’t like to be in the center of attention

#2 I am not confident with my looks

#3 I can’t stand all these people staring at me

#4 My voice is ugly

It’s okay to be afraid of public speaking.

There are more people afraid of public speaking instead of death. That’s a fact.

All these fears might seem difficult to overcome. If you feel the same way, today is your lucky day.

What you should do if you’re afraid of public speaking

Tim Ferris, famous entrepreneur and investor recently did a ted talk on fear. The title of his speech was: ‘Why you should define your fears instead of your goals’. Although he didn’t mention pitching or public speaking throughout his speech, his principles are spot on and can be applied here as well.

It all comes down to realizing the potential outcomes of your actions. For example:  Let’s say are contemplating whether or not to shave your head bold. There are two outcomes:

Outcome 1: You like it. You made the right decision

Outcome 2: You hate it. You have to wait two months for your hair to grow back.

By simply writing down the potential scenarios of your action you can already start making conclusions. However, entrepreneur and investor Tim Ferris took this to the next level.

 “we suffer more in our imagination than in reality”

Afraid of public speaking – let’s break it down

According to Tim Ferris there is a 3 step method you can follow to break down any fear. In this case the fear of pitching or public speaking.

Step 1

Take a paper and write down the following 3 things:

• What do you want to do? (in this case, that would be pitching)
• What you can do to prevent any negative outcomes
• What you can do to repair any negative outcomes

Step 2

Take another paper and write down all the positive benefits of your pitch. A few examples:

• An investor likes my pitch and wants to invest in my company
• A big corporate hears about my pitch and wants to partner up
• Google hears about your company and wants to buy your company

Step 3

This is probably the most important step, especially because human beings aren’t very good at this.

Here you take a paper and write down all the costs of inaction. So what happens if you don’t pitch your company? What happens if you decide not to speak at that event? And finally, what happens if you keep on postponing to do this.

• What happens if you never pitch your company in the coming 6 months?
• What happens if you never pitch your company in the coming year?
• What happens if you never pitch your company in the coming 3 years?

So take three pages and do this exercise. It should take you around 30 minutes and will definitely be worth your time.

You’ll see that pitching isn’t that scary as you thought.

You can check out the full video here:

Let’s apply this to your pitch

Step 3:

If I don’t start pitching my company:

• My company runs out of cash and we go bankrupt
• My company will miss out on big opportunities and we won’t grow exponentially
• My company’s growth will decline and we will never become a big player

Conclusion

These steps helped many people around the world to crush their fears and they will crush yours.

To end with a quote of Olympic champion Jerzy Gregorek:

“Easy choices, hard life. Hard choices, easy life”

Do you know entrepreneurs or friends who are scared of public speaking? Share this with them by using the buttons below. Good luck pitching!