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Bangalore: Pitching a VC! Do you think it's an easy task? Yes. Then why is it that many faces rejection in the hands of the VCs? What are the common mistakes that they make while pitching the VC? Look into the following points to prepare yourself before going for a pitch.
1. Ignoring the competition: Entrepreneurs become so confident about their idea and business that they do not find any competition standing near to them. When they say that they don't have any competition then VCs think they have come with a completely revolutionary solution to change the world or they have not performed enough research on the market. And most of the time the second explanation stands true.
2. Eager to talk about their idea and not themselves: It is good to talk about your business, but VCs also like to know about the person and his background to well understand where and in whom is he going to invest money. They want to know how he become an entrepreneur, who inspired him, where he is from, what his family is like, what he personally enjoy doing, and many more such things. Try not to produce a wage idea but present a clear picture of yours for the VC to easily decide on you and your idea/business.
3. If I build my idea, buyers will come: Every entrepreneur is in the perception that whatever he builds, he will get buyers to purchase it. Getting a customer part with his money is always hard. Try to understand the market and sales challenges better by actually trying to sell something. This will help him to stand in a much powerful position during pitching, by being able to present a clear picture about the sales of the product in the market.
4. Over Valuation: Everybody thinks that their idea and business worth millions. But it's not that way always. A sophisticated investor will ask, "What sort of valuation are you looking for?" They want you to answer the question as soon as possible. Do not push the investor with a ridiculous valuation nor set low ceiling too early which means selling your company for peanuts. Try to build a relationship with the investor and get a second meeting. Make them believe in you and your business and then talk specifics about valuation.
5. Do not pile information: Do not make the mistake of making all the talks in the first meeting. The best pitches are discussions and debates. Know your market intimately, know your competition, the problem that you are trying to solve with your product or service and make sure to be able to explain why this is a big market opportunity. Do a proper research on the investor you are going to pitch.
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