What is Foolsaurus?

It's a glossary of investing terms edited and maintained by our analysts, writers and YOU, our Foolish community. Get Started Now!


What to Keep in Mind When Presenting Your Idea to an Investor

Original post by Sherrie Scott of Demand Media

Present business ideas clearly and confidently to potential investors.

Many entrepreneurs turn to investors to finance business endeavors. An entrepreneur must sell or "pitch" a business idea to investors to persuade them to fund a venture or project. The ability to gain financing from angel investors or venture capitalists depends primarily on a business owner's ability to execute a business presentation successfully. When presenting an idea to an investor, it is important to keep in mind that a thorough and well-thought-out presentation is just as important as the business idea itself.

Contents

Opening Statements

When you gain the attention of potential investors, keep in mind that you do not have their attention indefinitely. Investors are busy, so your idea must captivate them early in the presentation. You have a limited amount of time to present your idea, so begin your presentation with a compelling story about what your business can do for the marketplace. You may keep the investors' attention by completing a demonstration of your idea within the first few minutes of the presentation.

Information Delivery

Investors do not need to know every single detail about your product or service. They do not need to know every potential direction the company may go in the future. Be precise when presenting your idea to investors. Describe the basics of your product or service in a way that convinces investors how they may benefit from partnering with you. Narrowly describe what your company is doing and why so that you do not overwhelm the investors with too much information. Too much information could confuse investors to the point that they do not understand what you are trying to accomplish with your business.

Company Background

Investors are interested in learning more about who you are as a business owner. They are not only investing in your business idea but also in you, your character and the integrity of your company. During your presentation, keep in mind that you must also include information about how your company came together. Mention what you have accomplished so far and briefly describe what you plan to do with the investment dollars.

Know the Investors

Although you are presenting your own ideas, it is also important to ask potential investors questions about their experience in your industry and how their expertise will add value to your business venture. It is also important to understand how the investors operate and their expectations for your business. Keep in mind that your business is most likely not the only business with which the investors will partner. Inquire about how much time they will devote to your business if they decide to move forward.


                   

References

About the Author

Sherrie Scott is a freelance writer in Las Vegas with articles appearing on various websites. She studied political science at Arizona State University and her education has inspired her to write with integrity and seek precision in all that she does.

Photo Credits

  • Comstock Images/Comstock/Getty Images


Advertisement