5 Signs Your Startup Pitch Might be Rejected by Investors

Why Pitching Matters?

Startup pitches are one of the first steps to attract venture capitalists to invest in your startup idea. Pitch deck presentations define your vision and approach to deal with unforeseen circumstances that might occur during your way to lead the business.

Investors always look for promising ideas and individuals who are able to prove their worth from the initial stage. Even if you have a very strong idea, you might still need to perfect your pitch to avoid blunders that can adversely affect your chances to raise funding.

Every investor has a unique mindset when it comes to evaluating the pitches. Some might revere your idea while others might turn faces from you; but if there is one thing that matters, it’s how smartly you tailor your pitch as per their needs.

So, if you are preparing a startup pitch deck to win on an investor, check for these 5 signs because if you have them, chances are high that your pitch might be rejected by investors.

1. Over-Promising

One of the things that startup pitches are found to have in abundance is the over-promising pretense at the initial stage. Although it’s good to have a strong belief in one’s abilities, at this stage, delivering ideas impact more than merely promising beliefs.

Prove your worth, don’t state it. To yank investor’s attention, it’s good to stick to the strategy of under-promise and over-deliver. Venture capitalists and angel investors deal with myriad pitches every so often; hence, they are experienced enough to guess which ones are worthy enough to actually meet the promises.

Instead of simply promising your success, try to align your idea to their needs and come prepared with a rigorous portfolio that states your potential. The best founders are those who keep track of their performance and have a clear roadmap that grabs the audience. Remember, do not ever overstate your performance nor over-promise your success to avoid straightaway rejections.

2. Generalized Target Industry

Before you plan to pitch on an investor, it’s very crucial to have a clear understanding of your target market and industry that will be benefitting from the idea. To elaborate on your market success, craft your startup pitch with detailed buyer personas via surveys, interviews, and thorough market research.

Rather than targeting a general industry or market, look for specific areas that can benefit from your startup. In this way, investors will see through your understanding of the market competitiveness and how you plan to attract your audience.

First, identify your market, come up with similar examples that have already hit the market, and adopt unique ways to showcase how you compete with your rivals. Remember to highlight some positive market feedback to further support your claims.

3. Missing Call-to-Action (CTA) Strategy

In the haste to highlight their future goals and objectives, presenters sometimes forgo to include the important most concept in their pitches: how to deal with unforeseen situations and what is the call-to-action in order to deal with a problem?

Every solid pitch has to have a perfect call-to-action plan that depicts real-life scenarios. A CTA demonstrates how you deal with a change of plans and carry your business forward to achieve your targeted goals in unfavorable circumstances.

Venture capitalists are there to listen to how their money will multiply if they invest in your idea. If you give an impression that you have no plans to deal with predicaments, you’ll jeopardize your chances of raising funds. Therefore, it is crucial to deal with your impending failures prior to failing.

4. Above-Market Salaries

If you are planning to raise your net-worth the next day you launch your business, you better rethink before highlighting excessive payrolls and above-market salaries in your startup pitch. It might be repulsive for investors to know that much of their money will be used on salaries rather than product development and research.

Startups take time to boost their market worth, which is the by-product of twice the effort invested to make it succeed. Perhaps there might be times when you’ll have to invest from your pocket or pay your homies half of their salary, but that’s what startups are all about: failure, then success, then failure.

“You want to pay yourself as little as possible. You don’t need to starve yourself, go homeless, or struggle mightily, but you aren’t looking to be rich off of seed funding. As an investor, I am always looking for a prudent individual when deciding who to invest in. I’m looking for someone who has the fiscal discipline and emotional intelligence to delay their personal gratification for a brighter, more lucrative future”, says Aaron Webber, Chairman, and CEO of Webber Investments.

5. Too Much Text and Information

Startup pitches are meant to give a general yet comprehensive idea of your goals and how you plan to turn them into money. It’s a misconception that incorporating all the information in a startup pitch will let you conquer the meeting because VCs only come to invest money, not time.

It’s good to impart useful and relevant information when pitching an angel, but too much text in a pitch deck can potentially kill your chances of getting funded. One might think of it as tenuous information, but it can be costly when you’re interrupted by the VCs and asked to cut it short and come to the point.

“Too much text is going to cause your audience of investors to read ahead of you. They stop listening and become disengaged from what you are saying”, says Guy Kawasaki, a Silicon Valley venture capitalist.

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