Tips for Pitching a Startup to Angel Investors
Are you looking for an angel investor for your small business? If so, you will need to ensure that your pitch is professional, informative, and thorough. Before you make your pitch, here are some tips to help with your preparation from previous SCORE Santa Barbara Chair Gary Kravetz.
If you need funding to launch your small business, an angel investor may be a very attractive option. Angel investors are typically high net worth individuals who seek out startup businesses and provide funding in exchange for a return Most commonly in the form of equity.
Seeking funding through an angel investor means working directly with another entrepreneur and is much more personal than a bank or other form of funding. Because the pitch to an angel investor is more personal, however, it can also be more intimidating. Pitching this type of investor requires you to sell them on your vision and inspire them to buy into your concept, many times before you’ve even sold a single unit or generated revenue. A professional presentation is the first thing an angel investor wants to see when considering your business.
Successfully pitching your startup to an angel investor requires preparation and professionalism. An angel investor won’t consider investing in your business if any quality or professionalism is lacking in your presentation. According to Gary Kravetz, SCORE Santa Barbara’s past chairman, “The first evaluation from angels will be on the quality of your presentation document. If this does not seem professional, you may not have another chance to be considered.” He recommends using a PowerPoint presentation when you first pitch to angel investors. “Most angels prefer entrepreneurs to present their business concepts that way,” explains Kravetz. Kravetz offers a detailed list of information that your PowerPoint presentation should include to convince investors that you’ve fully developed your business concept and have a quality roadmap to turning a profit.
- 1.An introduction to your company and its purpose
- 2. The problem your business will solve
- 3. The solution your business has developed to solve the problem
- 4. A detailed description of the product or service your business offers. Include an explanation of why your product or service is unique and why the timing is right to bring it to market.
- 5. Your business model
- 6. Your marketing and sales plan
- 7. A competitor analysis
- 8. Your management team with detailed experience and capabilities
- 9. Key metrics and financial results to date and/or future projections
- 10. Your proposal for the angel investor
Your presentation should be succinct with just enough information for the investor to understand the business idea and know you’ve done your homework. “Your PowerPoint should be mainly graphics and key points. If the angels are interested, they may ask you for more detail,” shares Kravetz.
Get feedback on your presentation before your pitch.
Always share your presentation with a variety of trusted individuals who you can rely on for honest feedback, like a SCORE mentor. A SCORE mentor will not only give you feedback on your presentation, but they’ll also work with you through the process and guide you on how to best approach a pitch to an angel investor to better your chances of success. Contact a SCORE mentor today.
Southwest Regional Vice President, SCORE
Since 1964, SCORE “Mentors to America’s Small Business” has helped more than 11 million aspiring entrepreneurs and small business owners through mentoring and business workshops. More than 10,000 volunteer business mentors in over 250 chapters serve their communities through entrepreneur education dedicated to the formation, growth and success of small businesses. For more information about starting or operating a small business, call 1-800-634-0245 for the SCORE chapter nearest you. Visit SCORE at www.score.org.Funded in part through a Cooperative Agreement with the U.S. Small Business Administration. All opinions, conclusions, and/or recommendations expressed herein are those of the author(s) and do not necessarily reflect the views of the SBA.