How to Win Funding With Your Pitch
Good morning, Kansas City.
Over the past 6+ years I have had the privilege of listening to more than 300 business pitches, to evaluate their readiness for funding. Based on their pitch, I must give a recommendation regarding whether that business should be funded, or not. These were not small decisions either. My votes, along with the rest of the KC G.I.F.T. Board of Directors, have played a role in granting over $2M directly to local Black-owned businesses.
My point being that I have seen a lot of pitches that I have had to take real action on. I’ve also learned a lot. I learned that having a well-rounded and thorough pitch usually means that you have a solid understanding of your business, the market you operate in, and your path to growth.
If you are a business owner, you should develop a pitch deck. You don’t have to apply for any competitions or even try to use it to get funding, you need to do it because you need to answer the questions a pitch deck will ask of you. This will become your business plan in visual form, that you can present to anyone.
“You need to answer the questions a pitch deck will ask of you.”
But if you’re going to pitch for money, then you need to know how to do it. You need to know what questions to answer and what not to spend too much time on. THAT, is why I’m writing this. Based on the plethora of pitches that I have both seen, and done, I want to give you my recommendations on what should be communicated through a pitch deck.
Offer Clearly Understood
Spend little time here (1 min)
This one is simple. I need to quickly understand what your business offers. What does your business do? Tell me directly, clearly, and avoid unnecessary fluff. People often spend way too much time here. They are moved by the passion of the business and/or the complexity of their market, and that makes them want to give all the details of their business, but you often just waste time telling us what the business does when we have already got it. Even worse, sometimes I will get all the way through a pitch without really understanding what the business is because they never clearly state what the business does.
Credibility & Market Understanding
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Credibility is another one that should be short and clear. If you are operating a business in the pet industry, it helps to know that you are a veterinarian or that you have worked in pet rescue for 10 years. But once you have told me that, you do not have to keep proving it to me, I believe you.
Demonstrating market understanding by including data like Total Addressable Market (TAM), Compound Annual Growth Rate (CAGR), customer segment trends, competitive analysis, and data on related markets, are all hints that you understand your market. This is always impressive, but this still should not be where you spend most of your time when pitching.
Traction & Financials
Spend even more time here (3 mins)
Traction is one of the most important, if not the most important, datapoint to show. I need to see that you have traction in your market, and that people are willing to buy what your business offers. Show me that you have gone from selling two cookies a day to ten cookies a day. Show me that you have 100+ new five star reviews this year. Show me that attendance at your events keeps increasing by 10% with every new event. This is important because at the end of the day, it matters what the market is showing.
Financials are non-negotiable when pitching. Here I want to know how much money you’re making and how much you’re spending, for each revenue stream, and overall. Business success boils down to financial data and at a bare minimum, I must see that you can talk about it. It also helps to show off your bookkeeping system by having a Profit & Loss summary. This whole section should be one of the places you spend most time in.
What You Are Asking For
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How Much: If you are asking for money to invest in your business, then I would expect you to know specifically how much you need and be able to defend your stated need.
For What: How are you going to use this money to implement a plan that will grow your business? You need to be as specific as possible. You can’t just say “I have a restaurant and I need to have more seating and get more customers”, or “I have a moving company, and I need more trucks to do more moves”, these are not plans. You need to show where those new customers are coming from. Do you already have the demand, and you can show it through traction? Can you articulate the plan for how you will identify the leads that will turn into customers? What is your process for identifying a lead, and turning that lead into a customer? The more specific you get, the greater your chances are of receiving what you are asking for. This is the most important part of the pitch. This is where a judge gets the information that they need in order to make a decision. Give this section all the time it needs.
The Outcome: After you implement this detailed plan, what is the impact it will have on your business? What will be the impact on future revenue? Will it allow you to expand the business offering? I need to know why the plan is worth the risk.
Additional Advice
Leave Space For Q&A: This can be your cheat code. Be sure to get all the necessary information into the pitch deck, but always leave space for Q&A. The judges take this opportunity to get any additional info they need. The judges are directly telling you what information will influence their decision. If you ramble or overtalk the judge, you are shooting yourself in the foot. There have been numerous times that I couldn’t ask a question that I needed to ask, because the person wouldn’t let me ask the question.
Practice: Your first draft is never good. I say that from personal experience. Anytime I draft a pitch deck, I ask the people I trust to rip it apart. I know they will see things that I didn’t and the deck always gets better. A pitch deck needs to be looked at from multiple perspectives, just like the business will be.
Watch Other Pitches: Watch Shark Tank, YouTube, and any other pitches that you can find. Take notes on what questions the judges are asking, and on what information the winning pitches were able to communicate.
As the CEO of an organization dedicated to progressing Black-owned businesses in Kansas City, I want to do whatever I can to help my people. This article is an attempt to do that.
If you have any clarifying questions on this topic, please contact me and I will respond.
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