Top Fantasies of Pitching #2
that Entrepreneurs tell Investors [ with Investor Comments marked “I” ]
compiled by Peter/CXO 02/13 with Wiz4.biz Comments marked accordingly
7. My Competition is too Big/ Slow/ Dumb to be a Threat. [I] Are you naïve or just stupid? Once the competition sees you as a threat, they will throw resources at it – (set up a Team, give them a big Budget). They may come up with an “as good” or even a better Product – (putting together, what they’ve learned from your product & your marketing). If they’re Big Boys, they could under-cut your price, to drive you out of business.
8. We have a ”proven” Management Team. [I] Do you have Founders of companies – where the products sold over $1M? If they have “proven” themselves, don’t they have their own sources for funding? So why are you talking to us? [Wiz4.biz] It’s best when Team has: 1) relevant industry experience, 2) passion, 3) persistence to hang in there thru the tuff times, 4) a complementary Board & Advisors that have “proven” success. You as Founder & CEO must be willing to step aside when either the management of the organization goes beyond your capabilities or you get more joy out of pursuing new ideas to create new products or services. Have you planned for that?
9. Our Product’s Patents are Defensible. [Wiz4.biz] Even if they are, do you have the time and deep pockets to fight for them. These are the most important factors.
10. All we have to do is get 1% of the big $1B Market. [Wiz4.biz] That’s the “top down” approach. You need the “bottom up” approach – how many can you deliver over the next time period; what effort will it take to expand my customer base?
How will Investors react to your Fantasies? [Wiz4.biz Comment]
1) Not at all, if they’re totally naïve. Therefore, they can give you only $$ and not advice,
2) They know you’re un-real, so they don’t care. Your product/ service hasn’t turned them on.
3) They will confront you, because they feel your product is worth it.
The Reality of the situation. [Wiz4.biz] It is best to be realistic, so you will be believed and establish your credibility. If you feel you have a Fantasy, figure out how you can make it realistic. If you don’t know, just say it. Tell Investors when you have made your “best guess”. Tell them you didn’t find the info you wanted and are still investigating. They will respect you more for it and that’s what you want. Remember, they’re investing just as much into “you” as in your fantastic Product.
Comments: Is there any Fantasies I’ve left out? What’s the most important thing a Founder can say?