Author - Brad Schrader (MBA '80), President, HBS Alumni Angels of Greater New York (outgoing)
I have seen hundreds of pitches to Angel groups, and I’ve seen what works best – and what doesn’t. Here are a few tips to improve your chances of success.
As the saying goes, “You only have one chance to make a first impression,” so make this count. I know you are super-busy, but treat this moment like your business life depends on it – because it does. A BIG part of an angel investor’s decision is the founder, so if your pitch is not well prepared, then we wonder about the rest of your business. No, we do not expect a TED-talk or the next iPhone rollout. We do expect you to have a few main points, supported by examples or data, which you know thoroughly. We expect you to stick to your time, and to move smoothly through your main points.
Skip the Fluff
Don’t mention your Advisors. Don’t add up your team’s “Cumulative Industry experience”. Do show proof of paid customer traction. Do show meaningful IP. Do clearly show your terms. Do say who is leading your round.
Everything takes time – more time than you want. Allow for time to get your product ready; to build a pipeline; for customers to try it out and actually place paid orders; for you to build, ship, and get paid. Use good business judgement – not rosy aspirations - to calculate TAM. Admit that you will likely need to raise more rounds – several more – and give us a range on how much more cash you’ll need after this. Above all, be realistic about your valuation; nothing speeds or slows your round more than that.
Tell us what your biggest risks and challenges are. We want to know that you know. If you hide them, we will find them during our diligence and then you will lose credibility, so tell us now. Tell us how you hope to manage these risks, and ask us for help – that’s one of the main reasons to partner with an Angel group.
Avoid Tech in your Pitch
Do not try to have your co-founder dial in and do part of your pitch; it’s not worth the tech risk and does not make much of an impact anyhow. Do not embed a video about your product or your company; half the time they misfire, so use your time with us directly and point us to this other content for later. Zoom pitches have the advantage of convenience and reach, but they are still not as good as meeting in person. If you can’t pitch in person, plan to meet your investor group later on.
Are you an entrepreneur seeking angel funding? Learn more about how to apply to pitch to the HBS Alumni Angels of Greater New York.
Author - Brad Schrader (MBA '80) - President, HBS Alumni Angels of Greater New York (outgoing)
Brad Schrader has led multiple B2B startups and turnarounds. He currently consults to Corporate Venture Capital clients, having recently retired as Chief Strategy Officer at Sun Chemical. From a start as an engineer, he has helped grow diverse businesses from fiber optics to airbags to specialty chemicals to eCommerce with BCG, Corning, TRW, Honeywell among others. He is an active venture investor and adviser.