When heading into a pitch or conversation with an investor you need to know the relationship your business has with the marketplace like the back of your hand.
Like all parts of the pitch, knowledge is strength and the investors are looking to be assured that you have the knowledge and have done the required preparation for their investment with you to be safe and thrive.
This article asks the questions you need to know the answers to when preparing your pitch. These answers will be unique to your business and in turn will help to win over a potential investor.
What issue is your business solving and is it a BIG issue?
When you created your business you will have done so because you spotted a gap in the market. There are two types of problems that the product or service you offer can solve:
- An existing problem.
- A problem you have created.
Either are perfectly valid reasons to create a business.
If your business solves an existing problem then how big is it? You want to make the problem seem as big as feasibly possible so you can show an investor that you will gain more traction in the marketplace and with customers.
Solving a problem you have created is not as sinister as it might sound. It only means conveying to the customer that they need your product or service for reasons they didn’t realise before.
The most important aspect of both of these is how effective you are at explaining your value proposition. You could have a product or service that solves a huge issue but if you can’t get that message across then you will struggle in the marketplace.
Why are you best placed to solve the problem?
You as a company might be solving a problem that is already being solved by another business so you have to show why your offer is the best.
Perhaps because the other companies are only solving part of the problem or that you can solve it better or for cheaper. Whatever the reason, you need to be clear why your business is best placed to solve this problem that needs solving.
What traction have you achieved in the marketplace?
If you have gained traction in the marketplace, already then it is important to prove it. Maybe you have done it through pre-orders of a product you’re about to release or you have a history of success with your previous products or services.
You may have testimonials, reviews and case studies for services you have provided that support your claim that your service is good quality and/or value for money.
If you have not achieved any traction in the market place it is not the be all and end all but you would have to outline your strategy for how you intend to gain traction in the future.
How do you plan to grow your business and gain market share?
This aspect of your marketplace pitch is crucial, as it will be what the investors largely look at. They want to know the plan you have to grow your business and through time dominate your section of the market.
You may plan to do this through investing large portions of your budget in advertising or perhaps you are going to make your product/services cheaper than your competitors. Whatever your plan to grow and gain market share, the potential investors need to see it and be convinced that it’s a sustainable and viable strategy.
A great place to begin in creating your actionable strategic plan is with a SWOT analysis. Through this you can evaluate your company’s strengths and weaknesses as well as looking towards external opportunities but also threats that could affect your company. From this basis you can create a detailed plan on how to grow and gain a market share.
Another brilliant tool that will help create your actionable plan is the MOST tool. This helps you break down the steps you need to take to achieve your business goal into manageable sections. Both the SWOT and MOST tools can be downloaded for free through this strategy toolkit.
To sum up
Investors need to know that you have done the necessary research and preparation when it comes to analysing the marketplace. Similar to your elevator pitch, you need to know all the information regarding your business and the marketplace as well as the strategy you have developed in relation to it.
It is likely that any potential investors are familiar with your marketplace already so they are looking for confirmation that you understand it too.
If you don’t have a strategy to grow and gain market share then you are likely to find it harder to impress investors. They want to know the gap in the market that you see, the problem you’re solving, how you’re the best at solving it and how you will gain market share.
If you aren’t confident in creating a plan to make gains in the marketplace then you can hire a Part-time Strategy Director that can work with you to create an actionable strategy. Through the experience and knowledge a strategy director can offer, you will be able to plan routes into markets and develop a plan that sets your business on the path to sustainable business growth.
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