Tips on winning an angel investment

Tim Mills
Peer Steinbrueck Visits Berlin Enterprises
Trying to secure funding for your business doesn’t have to be a daunting experience (Source: Getty)

Whatever your field, taking an idea from concept to reality usually requires convincing people that it will be a success.

Winning the support of investors is one of the biggest challenges.

Investment comes from many sources – it may be the boss, the bank, or a spouse that needs persuading. But for many high growth fledgling businesses, the deeper pockets and higher risk appetite of angel investors makes them a key part of the picture, meaning pitch sessions beckon.

A pitch session is when an entrepreneur needs to step forward into the spotlight, share the vision behind a cherished idea, and ask for the funding that will make or break their dream.

Sadly, there’s no magic formula for securing investment on these presentation days – any decision to invest depends on the right combination of people, product and chemistry. However, how these elements are delivered makes all the difference.

Communicate clearly

One of the biggest challenges for any entrepreneur, until they have sufficient paying customers, is explaining the opportunity and convincing the audience on how they will succeed. It is crucial that you conceptually set out what it is you are trying to achieve, and the value it will bring to customers and investors.

All too often you are pitching to investors who lack familiarity with your sector and may be a little detached having seen countless other presentations. Getting engagement requires you to be able to drill beyond the original idea, delve into the substance and ensure they understand it too. The trick to this is to be concise but comprehensive, ensuring you are covering all bases: why it is interesting, what the commercial opportunity is, what the competition is, what’s next. Despite their best efforts, investors are inherently subjective, so you need to show them that you know the sector and if necessary, educate them.

Demonstrate your team can execute

The second component to securing investment is more subtle, but arguably more important. Anyone probably has a good business idea tucked away somewhere, but a team of people that can bring a good idea to fruition is far rarer. A lack of belief that the team can really execute successfully can break a pitch.

A clear confident pitch goes a long way to demonstrating you can perform under pressure, and unfortunately panicking or looking stressed during a presentation can be a turn off. Presenters should stick to their strengths. If you know that you can’t comfortably talk freely, prepare some points that explain the narrative for you. And make sure you practise.

Entrepreneurs should remember that they are selling themselves, and sometimes that’s the best place to start the pitch. If you have an impressive history, or can genuinely claim to be an expert in your field, that can go a long way to securing investment.

Be memorable

It’s also important to make a connection to the investors you are pitching to. This means talking to them on a human level – use humour if appropriate, read their responses, and do not overuse superlatives. Investors know there will be plenty of things you don’t know and challenges you’ve not faced before, so demonstrating humility and a willingness to learn is also key.

Most importantly, be honest about who you are. Investors are looking for integrity in the people they are backing, and if you’re selling a false persona this almost certainly will show through. If you’re able to gain trust, bring people in to your vision of success, and demonstrate clearly what you are trying to do and why you are doing it, you are most of the way there.

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