If you are looking for insight on how to pitch your business to investors, then we have some good news for you.
You don’t have to look any further than your life to learn the majority of what you need to know.
Zig Ziglar once said that “Everything is selling.” Which means that we are all pitching. Most of us from the time before we could learn to talk.
If you have ever tried to convince your parents to let you eat something sugary when you were a kid, then you were pitching.
If you have ever asked someone out on a date, then you were pitching.
If you have ever asked for a raise, then you were pitching.
Don’t be intimidated about knowing how to pitch your business to investors. You’ve been doing this your whole life and you didn’t even realize it. Hopefully, this gives you the confidence to get started writing and preparing your pitch.
Once you realize you have the experience, the battle is halfway over.
For the other half of the pitch, we’ve got you covered. We have discerned 10 secrets from Shark Tank that businesses use to crush their pitches. We have even worked closely with Kevin Harrington, one of the original Sharks on the show and the person who wrote the book on becoming a key person of influence, so we have a lot of knowledge and experience to glean from both Kevin and Shark Tank.
Now you get to take advantage of these secrets to help you know how to pitch your business to investors to help your business not only survive, but thrive.
1. The “Tease”
Starting with the “Tease” is something you have done many times before. It is the thing that grabs the attention of the person to whom you are pitching. This is the step where you went to your parents and said, “Gosh, doesn’t it stink that we have to share the car? Coordinating our schedules is such a drag. If only there was a better way.”
The best pitches on Shark Tank call attention to a pain problem that their business is positioned to solve or alleviate. A little showmanship goes a long way to creating a great “Tease.” You want your “Tease” to sell well because it is the jumping off point for the rest of your pitch.
2. The “Please”
The counterpart to the “Tease” is the “Please.” You have made the pain problem clear and now you are going to reveal exactly what your business can do to solve that problem in the most efficient manner possible.
The goal with this step is to convince the investor how your business is better than any other in the marketplace at solving this particular problem. The best businesses pitching to the investors on Shark Tank follow up on a well-developed “Tease” with laser-focused “Please” that proves how great their product or service is. You’ve done this before when you have pitched to your friends why your sports team is clearly superior to their sports team.
A great example of the “Please” in action are the infomercials for Flex Seal where Phil Swift sprays Flex Seal on a screen door and then uses it like a boat to really show off the product. He isn’t even showing a useful application of his product, but he is moving from the way his product solves the primary issue of keeping water out and into the way his product can be used creatively. Just like in Step 3 below.
3. Show Your Business in Action
The third step in how to pitch your business to investors is to display your business in all of its glory. Remember those times you flaunted that Red Ryder BB Gun to all your friends? It’s the same principle here. This is where the best business pitches on Shark Tank show the real “razzle dazzle” of their product, even letting the Sharks partake in their product if applicable.
A powerful demonstration is the key to a successful pitch. Showcase every way your business can solve the pain problem you presented in the “Tease,” and don’t be afraid to show off everything else your business provides along the way.
A diverse business is a lot easier to pitch than a one-trick pony.
4. Accelerate Your Value
Picture the time you persuaded your parents why a specific birthday gift you were wanting would be so perfect. You keep mentioning all the features. You see that they are starting to believe you, but then you hear yourself say, “But wait… there’s more!”
That’s the next step, to roll everything you’ve already proven as a “no-brainer” and kick it up another notch by showing some added value that no one can say “no” to. The Sharks love to see the creative use or multi-faceted solution offered by some of the products of businesses winning their pitch from the get-go.
5. Provide Rock-Solid Testimonials
You have completely shown off your business and all the ways it solves pain problems in your industry. As you figure out how to pitch your business to investors, though, you will need to follow up with testimonials. More importantly, testimonials from people who aren’t invested in your success, specifically.
Look for unbiased testimonials from these people and areas of influence to prove your business is as great as you just said it was and proved it was:
Customers
Industry professionals
Editorial experts
Celebrities
Documented data and facts
On Shark Tank, they aren’t called Sharks for nothing. A business who lacks testimonials lacks credibility and quickly gets eaten alive.
6. Highlight Your Research and Competitive Analysis
Following the experiential data, you need to know how to pitch your business to investors using the cold facts of life. Investors want to see you have thoroughly researched as many aspects as possible about your business and industry.
A unique example of when you have done this exact pitch before is if you have ever had to purchase your own mattress. You take into account all of the factors and compare them side-by-side. You need all the data to make the best decision because it is going to be one that can either bring you a lot of comfort or a lot of suffering in the long run.
Your investor needs to know you take your business more seriously than you take a mattress purchase. When it comes to businesses pitching on Shark Tank, those who lack the data to back up their product or service are the ones who walk away with a raw deal or nothing at all. You need the data to prove your personal investment into the success of your business!
7. Reveal Your Dream Team
One important thing to know about how to pitch your business to investors: they aren’t only investing in you or your business. They are investing in the team you have surrounded yourself with.
Your Dream Team needs to be people who are invested in growing and scaling your business with plenty of diverse experience to avoid mistakes and make informed decisions. Your investor needs to see every person on your team and understand what they bring to the table.
If you have ever played Fantasy Football, then you know exactly what you need to do for your pitch. You need to bring together all the right players at the right time in the right situations. For your business, this could look like:
Board members
Legal advisors
Financial advisors
Industry experts
Social Media & Marketing experts
When you have the right people on the right seat on the right bus, then you have finished your Dream Team. With them in place, you should have no issues showing off your Dream Team to potential investors.
8. Show Why You Need The Money
This is fairly obvious, but this is the step where you explain why you are looking for an investor. As you assess how to pitch your business to investors you need to keep a series of questions in mind and prepare yourself for how you will answer them.
Why are you seeking an investor and capital?
What are you planning on using those funds for?
Are you expanding or increasing inventory?
Are you needing to expand your staff?
Reasonably so, investors want to know where their money is going. They want to know you are going to spend their money wisely. Be prepared to answer any and all questions respectfully and efficiently.
On Shark Tank, the Sharks love to ask these questions. Those businesses who didn’t have prepared answers were the ones who, more often than not, walked away with little to nothing. The Sharks don’t like investing with those who do the work but don’t sit down to truly assess their needs and plot their growth strategy.
9) Outline Your Marketing Plan
Since you have already prepared for all the questions your potential investors might ask, it is good to go ahead and try and answer the most obvious of these questions by explaining your marketing plan.
Walk them through how you plan on using the potential capital and ways you plan on advertising and expanding your business. Help them understand your plans to get word out about your amazing business and all it offers.
Investors want to see that you know how to generate leads and close sales. Even the best products in the world will get nowhere slowly if the business owners don’t know how to generate buzz about the product.
10. Ask for the Money!
Shark Tank would be just a group of people being mean to business owners if the businesses never asked for investments from the Sharks!
The moment you’ve been waiting for, asking your parents for a raise on your allowance. This time, though, your parents are the investors and you are the highly-qualified candidate who has crushed their pitch.
If you have done your absolute best at every step of this process of how to pitch your business to investors, then you will surely have a few investors chomping at the bit to dive in. It is important, though, to clearly communicate what you want, what you are looking for in an investor.
You can’t get what you don’t ask for, so don’t be shy to lay out your ask in no uncertain terms. Remember, your business can change the world. You just have to believe in yourself and your business.
Looking For Extra Help On How to Pitch Your Business to Investors?
Which of these steps is the biggest struggle for you right now? We would love to hear your thoughts and offer any tips or advice as we are able. At Catalyst Brand Group we focus on implementing proven growth strategies in brand, platform, and growth that will help your business grow by 2x-3x per year. If you are looking for help with pitching to investors or looking for help in other areas of your business, then Contact Us to start a conversation about how we can help.