For startup founders, successfully pitching venture capitalists (VCs) can be a necessity for business growth. Venture capital is the primary financial driver behind startups in almost every industry and vertical.
In 2021, a record $329.6 billion in investments was raised across more than 17,000 deals. This was nearly double the record set the previous year, which represents the massive growth in volume of VC capital in the startup ecosystem. VC funding reached a peak of $70 billion in November 2021, but 2022 saw a downward trend in VC funding month over month. Like all aspects of the economy, conditions in the VC world are forever changing, and the trends governing venture capital are subject to countless variables.
Whether or not companies receive VC funding to operate and scale is highly dependent on what happens during pitch meetings. As a founder, your challenge is to convince investors that you and your business are an excellent investment.
Here are 13 best practices for approaching pitch meetings with VCs.
Explain the opportunity in the first five minutes
Don’t bury the lede. Within the first few minutes of your pitch, your audience should have a clear idea of what the opportunity is and how you plan to take advantage of it. You’ll have lots of time to get into the details during the rest of your pitch. If you can’t tell investors why you are seeking funding, what you’ll do with it, and why they should trust you to make their investment grow, you need to spend more time prepping your pitch.
Make your pitch interactive
Find natural points in your pitch to pause and ask questions like, “Is this all making sense?” or “Do you have any questions so far?” Give your audience a chance to chime in with questions as the pitch unfolds, even if the structure of the meeting allows for Q&A at the end.
Avoid reading from your deck
Your deck is a visual aid to assist in your pitch—it is not the pitch itself. Investors are looking for proof that you really know your business and the market you’re addressing. Though it can feel counterintuitive, investors don’t need to see that you have an incredible deck, so avoid using your slides as a crutch in the meeting. For a deeper understanding of how to craft a successful pitch deck, see our guide on this topic.
Make the meeting a mutual evaluation
Questions such as, “What type of relationship do you typically like to have with founders?” and “What are your biggest investment goals for this year?” make it clear that you are interested in more than someone willing to write a check. You should be looking for investors who genuinely align with your business and share your vision for working together.
Brag about your team
VCs don’t just care about you, your ideas, and your market—they want to see that your team is capable of executing your vision. Talk up your people, and make the VCs in the room feel as excited about them as you are. As a founder, the ability to build and maintain a solid team is arguably the most important skill you can showcase to investors.
Be big, bold, and ambitious in your view of the future
Being a founder means having a bold vision that’s grounded—not hindered—by practical decision-making. You can expect VCs to ask detailed questions about what you’re doing and how you plan to achieve your goals. What they might not ask about is the big picture. Be proactive and lay out your vision for the future, backed up with an actionable plan.
Be specific about your potential market
Your vision might be huge, but your understanding of the market opportunity must remain detailed and specific. Two of the worst things you can say in a VC pitch meeting are “Everyone is going to buy this” or “Our target market is everyone with a computer.” Saying you’re “going after everyone” means your plan is not fleshed out. And VCs will notice this. It’s important to show that you have thought through which segment of the total market is right for your company—and that you have a plan to capture it.
Know who your competition is—and what sets you apart
A competitive analysis is an important component of every pitch. If you don’t know who your competitors are, you probably won’t be able to compete against them effectively. Be prepared to speak from an informed position to VC audiences about your competitors.
Admit what you don’t know
There’s nothing wrong with answering a question by saying, “That’s a great question. Let me think about it and follow up with you.” VCs don’t expect you to have all the answers; it’s okay to let them see your thought process. This will lend you more credibility than attempting to answer every question on the spot, whether or not you are prepared.
Ideally, you should practice your pitch in front of people who have experience both giving and fielding investor pitches. However, your roommate, partner, relative, or friend will suffice. The key is to put in the necessary time, practicing your pitch out loud several times before taking any investor meetings.
Speak clearly about money
You should know exactly how much money you’re trying to raise, what you’ll use it for, and what it will do for the business—and you need a very clear understanding of your business finances. Directly address the subject of money—nothing is more off-putting to VCs than a founder who is hesitant or unclear about the funding they need.
Keep your deck short and sweet
Don’t focus on creating the perfect 40-slide deck you spend three months preparing with a team of copywriters and designers. Keep it short and sweet—include only the key information you want investors to have on hand when they’re reviewing it after your presentation. More than 15 slides is probably too much detail for a pitch deck.
Have other asks besides money
Money isn’t the only resource that investors can offer. Do your research on every individual investor you meet with, and decide what else they have that might be valuable to you. Could they introduce you to other companies in their portfolio that might be beneficial to your business? Is there someone in their network who could be a great mentor to you? Do they know someone you’ve always wanted to get coffee with? Do they run an annual conference that you could be a part of?
Avoid walking into a pitch meeting with a list of demands. Approach these meetings as if they are part of an ongoing relationship, rather than one-off transactions. Even if a particular VC doesn’t want to join your latest fundraising round, you might still walk away with something deeply meaningful and valuable.