Author and life coach Tony Gaskins once said, “If you don’t build your dream someone will hire you to help build theirs”. This mantra undoubtedly echoes in the heads of all entrepreneurs.
But is this motto all it takes to succeed? For the lucky few maybe, but for most, it’s all about trial and error.
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Former Chief Executive of Public Trust and author Tim Sole addressed the issue of persistence in his book Make Success Your Friend, “Laziness is the habit of resting before you become tired and success is often found between tiredness and exhaustion. If you give up a goal knowing that there is something you could have tried but did not, then you gave up too soon.” However, persistence alone cannot get you to where you need to be.
Persistence along with knowledge can help you overcome these common mistakes when seeking funding for your venture.
The first impression
First impressions are everlasting, in whatever you do. The first few seconds of meeting with investors can greatly affect whether or not you walk away with what you need to get your company up and running.
Founder of Geneva Venture Partners, Igor Sill understands the importance of first impressions, “Investors need to quickly see the intrinsic value of investing their time, money, experience, reputation and network into your new business and generally draw that conclusion from the first impressions of the entrepreneur’s ability to articulate their business. Remember, you never get a second chance to make a first impression.”
Overloading the investor with information
Overloading investors with facts and figures will most likely confuse them, causing you to possibly lose your finding. “I don’t have the time to review a 50-page business plan up front to decide whether it’s worth taking a meeting or following up. Give me a 2-3 page executive summary and maybe a PowerPoint deck”, says Managing Director of venture capital fund Vantage Point Capital Partners, Richard Harroch.
Poorly researched competitors
Knowing your enemy as well as you know yourself will serve you greatly in the long run. Knowing where they have succeeded and where they have failed can greatly increase your own success. “Telling me you have no competition likely says you are unrealistic or naive. Of course, you have competition. Or someone who provides a substitute solution. And your analysis of your competitors will show me you have an understanding of the market”, says Harroch.
No demo
Physical models of your company can go a long way in helping you obtain necessary funding, not only does it provide a tangible representation of your idea, but it also shows that you’ve come prepared. “If you’re presenting in person and you’re pitching a product, you must demo the product first thing. Demos trump every form of presentation”, says the founder of Walker Corporate Law Group, Scott Edward Walker.
Failing to tell your story
All entrepreneurs start out exactly the same – from scratch. Investing your life into what you believe in is the string that connects all entrepreneurs. This means that skipping over who you are and why you want your dream to succeed; not connecting to an investor’s humanity can also cost you. “Like everyone else, investors love stories. So tell an exciting story about your startup and arrange your slides to reflect that story”, says Walker.
Speaking alone when you have your team at the pitch
A startup can be one man’s idea, but it can’t take a single man to bring it to fruition. Your team is just as important as the product you’re presenting; in some cases, it’s more important. Being a one man band can hinder your chances of finally getting your funding.
“Many investors consider the team behind a startup more important than the idea or the product. The investors will want to know that the team has the right set of skills, drive, experience, and temperament to grow the business. I want to be shown all of this together with a passion to do something truly great and unique”, says Harroch.
“Investors want to know that you have a good team. Only having the CEO speak at a pitch meeting is a mistake. How will the investor gauge whether the other team members are any good if they don’t hear them speak? And please don’t have the team members contradict themselves”, adds Harroch.
Overall vague pitch
At the end of your pitch you don’t want to leave investors with more questions than answers, what’s worse is your inability to answer their questions. “Entrepreneurs should practice their pitch with friends and advisors before presenting to an investor. You need to be prepared to give crisp answers to questions. You have to anticipate the difficult questions you may get. Telling me that “you will get back to me with an answer” seldom leaves a good impression”, says Harroch.
However, receiving questions from investors’ means that they’re engaged with what you have to offer, “If I am asking you questions, that’s a good sign that I am engaged. So do your best to answer them right away. Don’t evade the hard questions or tell me that you will get to it later in the presentation. I want to see if you can think on your feet. Expect to get interrupted during your presentation”, continues Harroch.
Some of these mistakes might not be fatal to your success, but avoiding them could bring you one step closer to a successful startup. Don’t give up in your pursuit, a failure today could mean a success tomorrow.
Feature image: Jacob Enos via Flickr.
