How To Pitch Angel Investors

We invited three B2B tech startups in the Venture Lane community to participate in our Investor Pitch Lab. Participants worked directly with a Mentor Committee of three experienced angel investors from the TBD Angels network to refine their investor pitch ahead of an upcoming capital raise.

On the Committee, we had Matt Fates (General Partner @ Ascent Venture Partners), Jodi Gernon (Director @ Arthur Rock Center For Entrepreneurship at Harvard Business School), and Emily Green (3-time CEO and Independent Board Director & Advisor). Check out their key takeaways below!

How to keep your messaging clear and compelling…

• Nail down your positioning statement. Fill in the blanks of “for (target customer) who (statement of need or opportunity), (Product name) is a (product category) that (statement of key benefit). Unlike (competing alternative), (Product name) (statement of primary differentiation). You will use parts of this statement throughout your deck.
• State future initiatives proactively. For example, rather than say your company will partner with a 3rd party to conduct a research study on your product, say that your company will validate the efficacy of your product with an industry-leading organization. Emphasize the positive outcome.
• Talk about solution more than problem. Describe how acutely painful the problem is that you’re solving, but spend more time describing how your solution is best in class. First-time founders have a tendency to spend too much time talking about the problem in their pitch.

How to present a convincing go-to-market plan…

• ROI > CAC at the start. It’s okay to pursue a higher cost GTM strategy if you need more proof of customer ROI. Once ROI is firmed up, you can use funds raised to pursue other GTM strategies that drive down CAC.
• Move shiny badges to the front! If you have well known customer logos or tens of thousands of dollars in MRR, present those details as early in the pitch as possible. Investors will be bought in, and the rest of the pitch can be spent on clarifying details.
• Respect the competition. Don’t be too dismissive of competitors in your space. Show that you respect their ability to capture addressable market thus far, but then go on to explain how your product is differentiated and how your company is positioned to overtake your competition in the future.

How to ask for funding…

• Investing is an opportunity. Frame your request for funding as an opportunity rather than an ask. The balance of power should be tilted in the company’s favor throughout the fundraising process.
• Keep your budgeting simple. Use of funds can be as high level as 50% on staffing, 15% on marketing spend, etc. No need to go any deeper in an investor pitch.
• Highlight the impact. Yes this round is a financial opportunity, but also communicate to prospective investors that they will be erasing $100M of wasted healthcare spend, preventing $1B of climate change related damages, etc.