Forget Dragon’s Den: experts explain how to REALLY pitch your business to investors

As you walk through a famously sparsely furnished brick-walled warehouse, you enter an elevator. Within 30 seconds you will be faced with the most difficult pitch of your life.

Pitching your business to five multi-millionaire investors is no easy task, let alone doing it in front of the cameras of Dragon’s Den.

Before facing leading business figures such as Deborah Meaden, Peter Jones, Sara Davies, Steven Bartlett and Touker Suleyman, Dragon’s Den entrepreneurs naturally put hours of meticulous planning into their pitches.

They will consider every detail as they pitch their product ideas to the ruthless entrepreneurs in front of them. These presentations will be flawless, right? Wrong.

The five dragons have seen it all, from less than truthful contestants to a traffic light system that the dragons say was “the worst invention on the show.”

So, what advice should you consider when it comes to pitching your business successfully? We asked two experts for their suggestions.

How to find investors for your business

Unlike the contestants on Dragon’s Den, you’re unlikely to find yourself with five leading business people lined up in front of you in no time.

Tapping into your contacts book should be the first thing you should do, says Scott Hill, corporate finance manager at accounting firm Old Mill. He recommends using your family, friends and business networks as a starting point.

‘It’s also a good idea to contact a corporate finance advisor; They are experts in business investment and so are best placed to share the different sources of funding available and, importantly, explain the specific pros and cons of each option,” Hill adds.

Sabesan Sithamparanathan, founder of tracking tag company PervasID, tells This is Money that his first step would be to determine the level of financing your business needs, whether it’s seed funding or Series A, B or C investments .

On average, seed funding is used to raise between £500,000 and £2 million, while Series A funding typically raises up to £15 million, Series B up to £50 million and Series C can be in the hundreds of millions.

“The next step is to painstakingly curate a targeted, comprehensive list of potential investors,” says Sithamparanathan. ‘Focus on venture capital firms and corporate venture departments of strategic companies that match your investment criteria and typical deal sizes.’

“Whichever investor you choose to work with, they should not only align with your financing needs, but also share your vision and values,” adds Sithamparanathan.

Make sure your pitch stands out from the crowd

Like the dragons, any potential investor will likely have several people vying for their attention and their money.

Ensuring your pitch is memorable is key to winning over potential investors, although it is advisable to avoid some of the pitfalls of previous BBC show contestants.

Avoid arguing with your potential investors, demonstrating products that don’t work, and don’t overvalue your company.

Scott Hill says it’s easy to forget that you’ll have to work closely with investors

Instead of impressing your potential investors with a gimmick, the trick is to get their attention by leaving no stone unturned.

“The pitch should strategically address key components to capture investors’ attention and convey the company’s potential,” says Sabesan. “The key message you need to convey is the size of the market gap and unmet needs, and how your solution effectively addresses these challenges, highlighting your unique selling points.”

Hill says the way an investor assesses risk is by evaluating the company’s past and current performance.

He adds that it’s best to “find a balance between past successes and future potential.”

“It’s also important to talk about your own track record as well as that of the company, as your own personal experience, knowledge and credibility will be a crucial part of any investor’s decision,” Hill adds.

Laying the groundwork before meeting investors is also essential.

“Before pitching your company to potential investors, thorough preparation is essential to make your pitch stand out,” says Sithamparanathan.

‘Making the presentation as visual as possible with charts, graphs, product demonstrations and customer installations is a top tip.’

Be confident… but not arrogant

If you want to make your pitch stand out, following Dragon’s Den participants may not be a wise move.

Even if you fail to secure an investment after the pitch, you don’t want to leave your potential investor with a bad taste in their mouth and a negative image of you and your company.

By alienating investors, not only do you risk cutting off a future source of money, but other potential backers may be less than willing to listen to your story if you become known for misleading investors. or fails to articulate the operation of your policy. company.

“When presenting yourself and your company during pitches, it is crucial to convey professionalism, confidence, openness, honesty and enthusiasm,” says Sithamparanathan.

The PervasID founder adds that his leadership team will dress formally during the presentation and focus on reflecting their respective expertise.

“When pitching, you have to be transparent and honest, and build trust and credibility,” he says.

Hill agrees that honesty is the best policy.

‘Once again it’s about finding the right balance. You need to have confidence – both in your own abilities and in the potential of the company – but chances are you are about to grow the company to a new size and scale that you have not encountered before,” says he.

‘Showing the awareness that you are entering unknown waters is always seen as positive by investors.

Entrepreneur: Sabesan Sithamparanathan has secured £7.8 million in funding across two investment rounds for his tracking tag company PervasID

Entrepreneurs should also not expect Dragon-like interrogation from potential investors.

‘Don’t believe what you see on TV, it’s a lie!’ says Hill. ‘You often see that potential investors push companies hard, which discourages many from even pitching. But negotiations in the real world are largely a two-way street.

“Yes, you’re selling your company to the investor… but there’s also an element that the investor is pitching to you, and you can’t forget that.”

How to seal the deal

‘I’m in’ are the words you like to hear from potential investors. If you’ve made it this far, you’ve seen the worst of it, but it’s not time to sit back and relax yet.

Someone may be willing to invest in your business, but don’t let that cloud your vision. Ensuring the investment is the right one for your business is not a step you should overlook.

Sithamparanathan recommends going through a term sheet or letter of intent with a fine-tooth comb, to ensure that your company’s interests are kept in mind, and to ensure that the valuation is not too high or too low is.

Unsurprisingly, not all deals on the show go through when it comes to the fine print.

According to Sithamparanathan, “It is also wise to assess the investor’s track record and honesty by referring to their interactions with other portfolio companies.

‘In addition to financial investments, the investor must bring additional value to the table, such as industry expertise or valuable customer contacts.’

In addition to their expertise and money, business owners should keep in mind that they are also building a partnership with their new investor.

“Chances are you’ll be spending a lot of time with your investor, so it’s really important that you get along,” Hill warns.

‘Although the financial and legal terms are studied in detail, it can be all too easy to miss the simple question: ‘Do I like the people I will be working with?’

What to do after the pitch

Unlike Dragon’s Den, when the deal is made inside the room (or not), in real life the work continues long after the field.

Sithamparanathan recommends that you contact investors and offer to provide additional information to help them make their decision.

He says, “It’s best to start the process with the intention of building a collaborative relationship, rather than just cash.”