At the beginning of an investor pitch, the angel investors will want a clear and concise overview of what the company does, why it is interesting, and why it could eventually lead to a large exit.
8 Jun, 2017FORBES.COM
Entrepreneurs need to be prepared when pitching their startup companies to angel investors by anticipating the questions they will receive. The failure to have thoughtful and reasonable answers to these questions will decrease the likelihood of the entrepreneur’s company getting funded. The following is a list of key questions all entrepreneurs should be well prepared to answer during their investor pitch:
At the beginning of an investor pitch, the angel investors will want a clear and concise overview of what the company does, why it is interesting, and why it could eventually lead to a large exit. So, expect that you will need to cover the following:
You will need to paint a clear picture that the market opportunity is meaningfully large and growing, so you will receive questions like:
For many angel investors, the management team is the most important element in deciding whether or not to invest. Entrepreneurs must show they are passionate, dedicated, and have relevant domain experience. So anticipate these questions:
The entrepreneur must clearly articulate what the company’s product or service consists of and why it is unique, so expect to get the following questions:
The company’s competitors will always be an issue and any entrepreneur who responds with “we do not have competitors” will have credibility problems. So make sure to anticipate the following questions:
Compared to your competition, how do you compete with respect to price, features, and performance?
The investors will want to get a sense of how the company plans to market itself, the cost of acquiring a customer, and the long-term value of a customer. So, be prepared for the following:
A company that has gotten early traction in some way will be viewed positively, so be prepared to answer these questions:
There inevitably are risks in any business plan, so plan to answer these questions thoughtfully:
For many companies, their intellectual property will be a key to success. The investors will pay particular attention to the answers to these questions:
Any angel investor will spend time understanding the company’s current financial situation and proposed future burn rate. Be well prepared for these questions:
The investors will want to get a clear picture of how much is being raised in the financing round and related information as follows: