For years start-ups have been sending investors and other potential funding sources their business plans. With more and more start-ups pitching these days, and funders having less and less time to review them all, a new trend is emerging about how to approach funders. It’s the one-page pitch. Get to the point immediately. Here are some basic questions the answers to which should be included:
· What’s the problem?
· How are you solving it?
· Who’s your customer?
· How will your solution make money (your business model)?
· What stage is your company in right now?
· How much money are you looking for?
· What are you going to do with the funds?
· What’s the payback horizon and how much return will the funder get on their investment?
What’s really good about the one-page pitch is that it can be a significant way to force you to clarify, condense and articulate your ideas.
John Ason, an angel investor, often speaks about the one-page pitch: he has approximately 1-3 minutes to look at your idea. And it had all better be on that one page. And not single spaced with no white space on the page. If it’s not visually inviting, he won’t read it. John always offers very pointed and amusing illustrations of how he wants to invest. When asked what John looks for in a management team, his answer includes passion but he also says the combined age of the two principals should not be more than his age. Another, related to return on investment, is that the payout should not extend past his lifetime – his event horizon (as is that of many investors) is a 10x earnings return on his investment in a reasonable time frame (usually less than five years).
To learn more about John, how he works, what he looks for when investing, what he’s invested in etc.
Check out Martin Zwilling’s post on pitching angel investors – BTW these points hold true for VC and other pitches as well.
Here’s a first time funder’s story