Model of venture is risk/reward. Fail fast, fail cheap.. Adjust your pitch based on your investors sweet spot. Show me a problem and convince me that nobody else is solving it the way that you are. Show me a vision that is powerful and will change lives along the way. Don’t lose potential profit to excuses. Act now. Prepare your pitch only to the allotted time the investor gives you and be prepared for any question they may ask. Every pitch isn’t a commitment to invest - it’s a first date to determine if the second date is warranted. Angel investors only invest in 1-4% of the deals they’re pitched bc people seeking investments. Don’t have the connections to people they could potentially get money from. Don’t pitch their business in the best way. ‘You have to learn the rules of the game, and then you have to play better than anyone else’ - Dianne Finestein. Present your business to get people eager to say yes. It will take time and effort to create a great offer.. You will face a lot of rejection. The baseline question in all these situations, will your business make me money?. Most early stage investors will only look at a deal if someone they know and trust brought them the deal. We need to know who we are trying to connect with. People that will already have an association with notes apps or wanting to write things down. Overall survival rate for tech startup companies: 20%. Overall survival rate for early stage tech firms that complete one of the mentoring programs offered by incubators: 80%. Your idea came in ‘cold’ aka did not come with a recommendation from someone they know. Use your networks to gain access to warm introductions with key decision makers. Investors identify high potential entrepreneurs from two key characteristics. The entrepreneur understands the investors objectives. The entrepreneur builds their startup with the exit strategy in mind. You need to match your funding request with the proper channel of funding. Business execution. How much money is required. Selling yourself and the opportunity. Your story must be so memorable it will stand out from the other thousands of pitches they receive. Our business must be. Consistent. Concise. Compelling. Must include a pitch deck that distills the most complicated and complex concepts of the product so they are not only interested, but intrigued to hear more.. The ability to answer any questions about potential risks. Product risk. Market risk. Management risk. Execution risk. Competitive risk. Financial risk. Must be able to mitigate those risks. A clear exit strategy that will end in a significant ROI for the investor. The most successful entrepreneurs often had what seemed to be some of the craziest ideas. But they also had passion, understood the mind of their investors, had great business plans, and were able to explain in clear and compelling terms what their business was going to accomplish.. Even with the best business and pitch in the world you will still get rejected.. Every entrepreneur knows the key to success is persistence.. Angels invest in people. The quality of the founding team. The initial bet they are taking is really about you. Investors must know you, like you, and trust you before they will fund you.. They are buying trust in you that you will build a large business that will be valuable. Angels love to mentor. They see their advice as more important than their capital. Advice is taken into action. Investors are usually looking for reasons NOT to invest in your company. 7 categories of red flags that need to be avoided at all costs. 2/3 of startups do not return the initial investment to the investor that funded them. Incubators and investor run accelerators. 7,000 accelerators. Organizations dedicated to helping startups succeed. Many are non-profit. Have an innovative idea but need help with a business model, regulatory compliance, or reaching the marketplace. Goal of growing businesses in a particular area. Rigorous application process. ‘Goldman Sachs 10-Ds’. Businesses are encouraged to come up with an innovative idea. Accelerators focus on technology groups that are well past the ‘idea’ stage. Usually only last a few months and make the company more investor worthy. Sometimes the founders need to move to the host city. Could receive funds in range from $10,000 - $150,000 in exchange for small stakes in equity. Accelerators usually culminate in ‘demo days’ where they pitch their ideas to VCs.. Graduating from an accelerator can grant access to better future funding tools. They have been ‘vetted’. Angel investors are wealthy individuals that invest in high potential startups usually in exchange for debt, equity, or a combination of both. Angels invest $24B per year. The medium check size is ~$35k. The average rate of return is a 9x multiple within a 5-year time frame. 5 things angel investors can offer. Angels do not need to consult with anyone else. Angellist.com. Gust.com. Search for LinkedIn groups for angel investors. When you approach angel investors think about the problem you are solving, because angels are always looking for good deals.. Most tech start up’s fail because they do not know how to make money they only know how to raise it. Corporate venture capital. Family offices. Wealth preservation. Often take a more long term approach. Make sure that you have a long term business plan with lasting value. Almost always sourced through personal relationships. Get in touch with the CIO through your own personal network. How to make fundraising efficient and effective as possible. Are there key hires you need to make?. Hire a marketing firm to reach more users or prove there is a significant market to utilize our product. Set your goals for the next 12-18 months and put in timelines for the specific milestones. Calculate how much money we will need to reach those milestones. Augment those numbers by 10-40% to cover unexpected costs. This will be the starting request for how much capital we want to raise. Asking for a specific amount linked to specific milestones will make us seem like a more credible risk instead of asking for a round sum. ‘This is what I need’ or ‘this is what I can accomplish with this dollar figure’. Valuation is an art, not a science.. Compare the company to similar companies in our region. Seed round. The first time you approach will be the hardest and the longest.. Money to grow the seed of your business until it becomes viable.. Cover your expenses to hit milestones for next 12-18 months.. Turn demo into a workable iteration. Hire a key team member. Grow your customer base beyond those signed up for our service.. Seed can be $10k - 750k. Top range is only for biotech and medical sales. Complicated businesses.. Usually approaching angels specializing in seed funding. May offer us convertible notes for future equity. Rather than asking for equity upfront. Because the amounts are small. It may only take 1-2 meetings before reaching an offer.. Since we are pre-revenue, our company will be based on our story, the ability to communicate the vision, and the team we have in place.. We can expect to hear A LOT of no’s.. So it’s a great place to test out our story and refine our vision to when we get told no.. Betting on you more than your business as we continue to develop our product or our business.. Because they understand a lot of pivots will come.. Strategic networking is your key to success. If one resource doesn’t give you what you need, you have 10 more people. Think about the referrals from other investors. Sometime it’s difficult to get your foot in the door. Huge reputational obstacles. Get to know other startups. Begin by making a list of people you interact with regularly. Put a star by the people you have the best relationship with (the co-founder of your startup). Organize your list by columns. Column 1: 25-50 people who are the greatest help us reach investors. Rank those people on a scale from 1-5 (1 being least and 5 being most likely) of how much wealth, gravitas, connections, etc. 4 and above are our champions. In column 2 write where you met them and make notes about things you have in common. In column 3 brainstorm possible connections they can make for you…bankers, CPA’s, investors. All of this is going after a warm introduction. Five ways to add the people you need to your network. The best thing you can do is add value to the other person. How can I help this person today?. Our value may be the list about the conversation. Five warm introduction sources. Proper Email Etiquette. Be prepared to answer every question potential investors will ask of our company. Can a founder articulate how we are going to make money and receive a return on our investment. The elements of a business plan. Remember to write your business plan with our target market in mind. Market differentiation. Path to profitability. Amount of investment needed. How investors will receive a significant return. Any business plan is educated guesses that needs to be revisited regularly. Part of setting regular goals as we learn more about our customers. Three things the founder of any startup needs to know. A pitch is a presentation where you have 10-40 minutes to sell investors or organizations that you, your team, and company present an opportunity for them to reap significant returns. They usually see a pitch deck and presentation are the first thing they will see. On average only 1% get funded. Because they have a bad pitch and can't communicate the viability. If you can't figure out a way to get a warm introduction, you probably can't find the way to your customer either. Once you have the warm introduction, outline your business idea and ask for the meeting until you get a yes or a no. If no, ask why and then ask who else we should talk to. When they say yes. Find out who will be in the room. Research the kinds of deals they've done and the size. Dig a little deeper to figure out what gets them excited outside of work. Build rapport on that and establish a connection to your app through that interest that they have to customize the pitch. The pitch is not designed to raise money but to get the second date. Pitch needs to a combination of -. A clear business plan as outlined in your deck. A compelling presentation with interesting stories instead of dry facts. Delivered by you with confidence, passion, clarity, and brevity. Essentials of a great pitch deck. The real goal is to get a second meeting. A great pitch tells a great story. 'Let me tell you a story'. They will relax and appreciate the emotional journey. The confused mind will ~always~ say no. If you can't answer investor questions, we will also get a no. Be concise and clear