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Basic questions you should be prepared to answer before meeting with investors

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Key takeaways

  • When it comes to pitching investors, preparation is key.
  • Think through all the potential questions an investor might ask. Then, prepare your answers.
  • When you’re pitching investors, put yourself into their shoes.

Pitching investors is one of the most important tasks you’ll face in building a successful business. No matter how great your idea, if you can’t get someone to invest in the launch of your business or help it grow, you don’t have much of a chance at success.

As an entrepreneur, you should prepare carefully when pitching your company to investors. Think through anticipated questions and practice your responses. Remember – it’s not all about you. The money, time, and expertise investors will be bringing to your brand means that it’s as much about them as it is about you.

To help you prepare, we’ve put together this list of key questions you should be able to answer when pitching your business:

Business idea

What problem are you solving and how did you come up with this idea?

Who is your target audience?

How does your target market solve their problem now?

What makes your business idea unique?

Organization and expertise

How are you going to use this money?

Who is on your team?

What is the experience and credibility of your team?

Have you had prior business success? How can you prove that?

What’s your launch plan?

How will you determine the valuation of your company?

What are your company’s three-year projections?

What is your growth plan?  And how do you plan to scale your growth?

Sales, marketing and distribution

What’s your sales model?   What’s the sales cycle like?

When will your products be ready to go to market?

How large is the market you’re targeting?

Where are your customers located?

What’s your distribution model?

How are you going to market your business?

What are the barriers to enter this market?

Differentiation and competitive advantages

Who are your competitors?  And how do you compare to your competitors?

Does your business incorporate proprietary technology? If so, how do you plan to defend it?

What vulnerabilities does your business have?

What legal, regulatory or product liability risks do you have?

What are your business’ achievements and milestones so far?

What advantages does your competition have over you?

Profits and cash flow

How will you make money on your products?

At what price will you sell them?

What will be your margins?

How will you make money for your investors?

Writing a solid business plan and then creating a pitch that will incorporate answers to these questions will show your investors that you’re prepared; you know your company and your competition; you know your target market; you have identified strengths and weaknesses; and you are ready to launch!

Don’t hesitate to reach out to our team of business bankers if you have any questions.

MidWestOne Bank does not provide tax, legal or accounting advice. This material has been prepared for informational purposes only, and is not intended to provide, and should not be relied on for, tax, legal, or accounting advice. You should consult your own tax, legal and accounting advisors before engaging in any transaction.

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