Investor meeting – cheat sheet for founders (1/2)

How to be in control for your meeting with investors? If you’re a startup founder looking to grow your business, sooner or later you’d end up rubbing shoulders with investors seeking capital for growth. While you are putting your blood and sweat in your business – prepping up for an investor meeting should not be taken lightly.

Why does prep matter? Short answer – “it’s all about time”. On an average investors receive more than 12-15 pitch decks in a day. VC/Investors have a really packed schedule and you’re lucky to get a slot in their calendar. They’re going to have a dozen of things on plate so a founder needs to leave a lasting impression in the first meeting itself.

So, now you understand the constraints the investors are working with – let’s understand the fundamental questions founders need to be ready with, to nail that slim window of opportunity.

1. Business story – a short and crisp version of story about the genesis of the business and developments thereafter.
2. Unique selling proposition (USP) – why is the product/service being offered stands out in the market vs other similar product
3. Market sizing – how big is the market? Every investor wants to enter/operate in a market with a big big potential (read loads of potential customers), so that the startup can gain traction and scale up once the momentum sets in.
4. Competition – there’s a right way to understand this variable, if other companies were able to see light at the end of the tunnel – then so can we. Having competitors is a positive sign for a market with scale, while every company wishes to tap a virgin market but that’s something far from reality baring certain exceptions. So, it might be helpful to create some sort of a 2×2 matrix and identify where you stand as a company vis a vis competition. What are the strengths, areas of opportunities etc. Vital elements like – pricing, branding, packaging, customer delivery experience to name a few can add perspective in the same.
5. Moat (read competitive advantage) – what is that you can do and none of the competitors would be able to replicate. Network effect, cost of switching, distribution, cost structures, customer experience, data/analytics, brand etc. can help a company create moats around the business.
6. Hurdles in growth – this is one of our favorites! What is stopping you to grow the company from scale 1x to 10x and beyond? Involves a deeper level of introspection as the “real” answer might not be the first answer you can think of. Going one or two levels deeper might help you in arriving correctly at it.
7. Smart growth plan – so, now you’ve figured out the hurdles, the next logical question is to have an action plan ready (at least on a piece of paper) that describes how you plan to go about the growth journey. Which top markets do you plan to penetrate, which top products you want to go full throttle in upcoming quarters etc.
8. Use of funds – once a high level growth plan is ready, link it with capital requirements. The more clarity you have the more comfortable investors would be in supporting your plan.