How tech startups can present their best selves to investors

Businesses need funding and, in the beginning, that means impressing investors. Here are some tips on how to do that

Building a business is hard. For every great idea that gets funding from investors, there are many, many others that don’t. Many that fail to get funding don’t miss out because their ideas aren’t worthy, but because they just don’t present their best selves to potential investors. 

Investors aren’t mind-readers – they don’t know what you don’t tell them. Nor are they likely to want to support a business that doesn’t seem capable of presenting its ideas well or doesn’t know some basic facts. 

Advertisement - Article continues below

It's important, then, for tech startups to present their best selves to investors. Here's some advice from the other side of the table on just how to do that.

Be specific and be accurate

There is little point meeting with a potential investor if you aren’t able to address the key points they want to know about, and you will need to be very specific and very accurate with what you present. Don’t think you can pull the wool over their eyes or blind them with fancy footwork. They’ve seen it all before.

Among the things you need to be specific about are the market you are in and your potential to grow. Iskender Dirik, managing director at Samsung NEXT (Samsung’s corporate VC) gave a number of very specific questions he expects to have answered: “What problem does your solution solve? And how big is that problem in reality? How big can your startup become? Does it have unicorn potential? Does it address a market that is already huge or has the potential to be huge in the future? Does it have the potential to generate significant revenues?”

Advertisement
Advertisement - Article continues below
Advertisement - Article continues below

Oliver Holle, co-founder and managing partner at Speedinvest, a pan-European VC for early stage startups, says founders should “explain in simple terms why the world needs you. What is the problem that you solve and why is your solution much, much better than what is available today? Plus, have a clear plan for the next twelve to eighteen months. Lay out what you will achieve by then, in terms of traction, product and team.

“And, please, don’t argue that you don’t have any competitors.”

You and your people are you greatest asset

It doesn’t matter how great your ideas are or  how much you think you can scale them at speed, without a great personal approach and the right people in your team it’s all pie in the sky. So your potential investors need to know that you’ve got the right smarts. 

Alexia Arts, investment manager at MMC Ventures says: “This is critical at the pre-seed and seed stage so do not undersell yourself. It's worth going beyond listing your experiences and explaining why you and your team are best placed to build this particular startup.”

Advertisement - Article continues below

As for your own skills as the owner and founder, Oliver Holle gave us a vibrant pen-portrait of a great founder., saying: “Great founders exhibit a talent to combine seemingly opposite character traits into one cohesive appearance. They are bullish and very clear about their long term vision, exuding inner confidence that they will inevitably succeed. At the same time, they are highly pragmatic about their tactical path, eager to listen and learn and adapt, showing humility about all the things they don’t know and cannot know.”

Practice makes perfect – but be yourself

While all this might sound like a tech startup has to be pretty formulaic in its approach, getting investment isn’t about behaving like a clone. Alexia Arts explains: “I wouldn't follow a ‘one size fits all template’. This results in founders fitting their story to a mould, rather than thinking about their own narrative and the key points you want to get across.”

Advertisement - Article continues below

It is also important to practice, and Arts says you can practice with practically anyone you know. Doing this, she says, “will ensure that you are getting your points across clearly, help to refine your message and improve your confidence when pitching”.

Related Resource

The IT Pro Podcast: Coding our way out of recession

How the COVID crisis could lead to a startup boom

Listen now

“As a CEO you will need to pitch your company time and time again over the next 5-10 years so you might as well start practicing,” she adds.

Practicing might also help you get prepared for negative responses. Iskender Dirik says: “Because the default answer of an investor will most often be ‘no’, founders need to create a sense of ‘FOMO’ – fear of missing out. They have to convince the investor that saying ‘no’ will mean losing out on a huge opportunity to invest in ‘the next big thing.’” People you try your pitch out on will be able to give you some experience of handling negative reactions, which will help you in the real pitch.

Advertisement - Article continues below

It’s unlikely to be easy to get funding for your tech startup, and there is no magic formula that will put you ahead of all the rest. But there are some basics that it’s vital to get right, and presenting your best self to potential investors can really help your cause

Featured Resources

Staying ahead of the game in the world of data

Create successful marketing campaigns by understanding your customers better

Download now

Remote working 2020: Advantages and challenges

Discover how to overcome remote working challenges

Download now

Keep your data available with snapshot technology

Synology’s solution to your data protection problem

Download now

After the lockdown - reinventing the way your business works

Your guide to ensuring business continuity, no matter the crisis

Download now
Advertisement
Advertisement

Recommended

The IT Pro Podcast: COVID-proofing your startup
startups

The IT Pro Podcast: COVID-proofing your startup

10 Jul 2020
US Rep. Bill Johnson introduces the Advancing Tech Startups Act
Policy & legislation

US Rep. Bill Johnson introduces the Advancing Tech Startups Act

22 May 2020

Most Popular

How to find RAM speed, size and type
Laptops

How to find RAM speed, size and type

3 Aug 2020
How to use Chromecast without Wi-Fi
Mobile

How to use Chromecast without Wi-Fi

4 Aug 2020
How do you build a great customer experience?
Sponsored

How do you build a great customer experience?

20 Jul 2020