No app can go from initial concept to global domination without the right funding behind it, and at some point a lot of developers will need to court VCs in order to push their project to the next level.
Pitching to venture capitalists is not always straightforward, and it can be a daunting prospect if you’ve never done it before. To give you a leg up, here are some important points to consider when you put yourself through this process.
Make sure a VC is the right choice for your project
Not every app is a good fit for VC funding, both in terms of what the project has to offer prospective investors, and what you want to get out of it as a developer and a founder.
VCs are usually looking for unique app concepts that are set to be both incredibly disruptive and game changing, as well as potentially delivering a huge return on their initial investment. They don’t want slow-burners with solid but modest prospects. They want the next Facebook or Spotify.
If you don’t think you fit this scope, you could consider alternative financing options, such as the AWS Activate program, which also means you don’t need to dilute your equity and give external investors a say in the future of your app.
Pick the right investor
Pitching to a VC who isn’t familiar with, or interested in, app development is a waste of time. You need to seek out those who have a track record for backing app-based startups, as they’ll be far more amenable to your pitch, and also deliver the expertise you need to succeed if you get the green light.
Of course you might have a large pool of prospective VCs to meet with, because you’re working in the always-hot app space. It can be handy to limit the number of pitch meetings you schedule, but it’s equally useful to get as many in your diary as possible, even if you don’t necessarily think that every one will be the right fit for your project.
The more practice you get, the better and more polished your pitching skills will become, preparing you for the meetings that really matter.
Put together a robust business plan
Your business plan has to be bulletproof if you are going to hit a homerun with your pitch, so don’t rush the research and writing of this.
Also aim to make your plan short and to the point, showcasing the strengths of your app as a priority. You can go into the projections for revenues if you want, but focusing on the fundamentals is better, as experienced VCs will see through overoptimistic estimates in an instant.
Once you’ve got the docs you need into a presentable state, fire them off to VCs before the pitch is scheduled. This should give them time to go over the info and get up to speed, which will make your pitch easier. Likewise, if pitch material hasn’t been reviewed beforehand, that’s a bit of a red flag, so there are several benefits to this strategy.
Cover the main points concisely
For the pitch itself, there are a handful of elements you’ll need to cover, and it’s best to do so without running on too long or over-explaining yourself.
Explain the background of your team, unpick the nature of the app, explore why it is ripe to disrupt the market it targets, and finish on the financials.
If a pitch deck is much more extensive than 10 slides, consider making cuts. VCs will ask follow-up questions if they need more info.
All that remains is to prepare, practice and don’t expect to succeed with your first pitch. Getting used to rejection is a skill in its own right!