Monthly Archives: October 2008

What not to say to a potential investor, angel or VC

The French have a great expression: “c’est le ton qui fait la musique

Especially in these times, pitching to investors is tricky.

Following are some tips for companies presenting to angels, VCs and potential investors.

 

Keep your presentation short and to the point! Inventors only want to know three things: how much do I have to invest; when will I see return on my investment; how much will I make on my investment.

 

When pitching, many high-tech entrepreneurs make classic mistakes. This is often the result of their technical background with limited knowledge of marketing.

 

Below are some terms that should be avoided at all times:

 

I’m bright and ambitious.”
Your investor will find this stating the obvious – it is unlikely that he will deal with stupid, lazy people.

 

I think outside of the box.”
Your investor will translate this to: “I haven’t got a clue about business or marketing & sales, I am a techie”


I don’t know much about your firm“.
Your investor will get annoyed – you didn’t do your homework and are therefore wasting his time.  

 

I am a creative problem solver.”  
Your investor will link this to bug-riddled software or products still in their early beta-phase.

 

My product serves many needs and is suitable for many markets”.
Your investor will understand this as not being focused. He will assume that you haven’t got a clue how your product will serve its target audience.

 

I’ve always wanted to be an entrepreneur.” Your investor will wonder if you have the skills to be one.

 

I’m sure you are aware of the growing need for security, Web 2.0, Open Source.”

Your investor will find this superfluous – he just wants to know about the ROI, not about the latest cool technologies or trends.

 

 If you sign an NDA, I’ll tell you my idea.”
This is a surefire way to scare off any investor. Venture capitalists are not interested in the technology, but in the revenues. If you want to protect your idea or product, get a patent.

 


“The last time I contacted you, I…” will remind the investor of the previous time you set opposite of him – unsuccessfully.

 

 

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