The #1 Problem with Your Investor Pitch
I’ve had the honor of supporting hundreds of investor pitches. From those experiences, I’ve seen that some entrepreneurs have the gift of being really great salespeople. They can pitch a great idea — or a horrible idea — and people get excited either way.
However, these people are not the majority. If you are like most entrepreneurs, putting together an investor pitch for your idea may not be that easy.
When telling someone about your business idea, do you ever get a blank stare? A confused expression? Some other sign that shows you that they don’t quite “get it”?
There are a few reasons for this:
- You have several, somewhat intertwined, business ideas. When sharing them with others, you tend to mention all of them at once which can be confusing to people.
- You are sharing your vision from an insider’s perspective. Your audience is an outsider and is only hearing this for the first time, and cannot process the picture you’re painting.
- You are pitching an idea too broadly. You are not explaining the specific value proposition or the problem your business solves for people.
This all boils down to the number one problem with most investor pitches: Entrepreneurs tend to become obsessed with their own ideas while pitching.
They should consider what the investor needs and wants to hear and understand instead.
But no worries if this is something you have struggled with. This mistake is common! It’s actually good news because you have 100% control over it. You can easily fix it, with a simple approach.
Just because people don’t “get it” doesn’t mean you have a bad idea.
As a Business Plan Consultant and Professional Pitch Consultant, I hear awesome business concepts all the time. Yet, it still amazes me when a business owner has doubt in their own idea based on shallow feedback from others.
It’s always a little bitter-sweet when I have to tell them: “Your business idea isn’t bad; you’re just bad at pitching it.” (Someone’s gotta say it.)
When people hear a new idea, it is easy for them to feel confused. Unfortunately, the natural response is to take the easy road. They reject the concept instead of trying to understand the business potential. They think: “I’m confused, so it must be a bad idea.” However, you can prevent this if you adjust your approach to the simplest form possible. You will avoid overwhelming your listener and be more likely to have a positive pitching experience.
How my Client Avoided Overwhelm by Adjusting the Approach An example of this in action happened when one of my clients was looking to launch an indoor amusement park in Coney Island, New York. The project was massive, and the business plan was absolutely brilliant.
However, the whole concept had a ton of moving pieces. There were over 30 revenue streams. They had different angles to consider for the locals, and specific marketing tactics to contemplate for global tourists. The amusement park also had room for arcades and indoor basketball courts. There was space to add affordable condos nearby, which created much-needed housing.
All in all, it was a great project. However, when my client went to do his investor pitch for his idea, he tried covering everything at once. He couldn’t stay focused on the big picture of the project and was easily sidetracked, explaining the many components involved. All this information overwhelmed the investors, and my client was getting frustrated that no one seemed to understand his vision.
I worked with him on his pitch and on simplifying his business plan. We boiled it down to the biggest two themes for the whole project. These included a revitalization of Coney Island and a theme park that would offer year-round entertainment for tourism activity.
Because we kept those things in focus and steered clear of the rabbit holes, the pitch went perfectly. He was able to secure multiple investors. With the simplified pitch, the investors were able to digest the concept and had interest in learning more details later.
So, dear entrepreneur, the good news is that your idea is probably a good one. You may just need to work on your pitch and your focus.
How to Get Started on Your Investor Pitch
Map out your business vision and break it down into components. What components are present on day 1? When you open your doors, what do you immediately want to be known for?
This one thing — maybe two things max — is what you need to focus on for your investor pitch. This is your real idea. Yes, there are other parts involved and other related ideas. Most certainly, make sure your audience gets this one thing clearly before you go into anything else.