The month of January wrapped up with the first ever DiscoverMe conference in Los Angeles, an exclusive three day networking and educational event for entrepreneurs and industry leaders. In attendance were leaders in finance, crowdfunding, Bitcoin, and startup advice. With the help of some great friends, my partner and I were able to attend this awesome event where we were after just one thing- to find an investor and pitch them our company we started in college a couple years before.
Reaching out to an investor is a major step in the life of your startup (which you should actually call your company when at a business event). Going into the event we were pretty nervous but enthusiastic. During an opening dinner, we placed ourselves at the right table, the one with the most VCs at it, and the introductions and playing it cool began. My partner and I managed to land a meeting with a couple investors we were eating with to pitch our event-based social media company. My advice from this is to try and keep your nerves in check- we luckily secured a meeting at the end of dinner for 8am the next morning in the hotel lobby-neither of us could sleep and I barely held my breakfast down in the morning.
If your company is ready to take on investors, make sure you have these five points covered and increase your chances in landing a deal because they certainly helped us.
1. Research investors before the event.
You have to know who you need to be talking to before you get to the event. Research the venture capitalists, angel investors, and even startup advisors that you need to be talking to. Nevermind if you can get a hold of them, you can worry about that later, but keep your eyes on the prize and know who and what you are going in there for.
2. Have your business cards ready and looking good.
It shouldn’t even be a question of whether or not you need business cards for an event like this. What you should be concerned with is how your cards look. Having sleek, stylish, and simple business cards with a creative logo is a must. The best cards we collected were thicker, well designed with a glossy/matte combination that made the card worth keeping. It might be more expensive, but investors will notice the difference especially when the rest of the cards they collect are plain white, flimsy, boring, and pretty much forgettable.
3. Be confident. That is all.
Let’s be real. When you walk into a room full of millionaires whose money you want and need, you have to have some balls to be cool about walking up to them to introduce yourself. In reality, it could be as simple as finding THE table with the most VCs at it and asking if an empty seat is open. Make eye contact, smile, have a firm handshake, and ask what they do for business. They are bound to ask you what you do and that’s when you hand them your awesome business card and hit them with your elevator pitch.
4. How is your elevator pitch game?
It’s all about being concise and interesting. Give them a general idea of what your company does in less than a handful of sentences. One of the biggest complaints from VCs is that it takes more than five minutes before they even know what your company does. Understand that most of these investors basically have A.D.D. and check their phone quite literally every 30 seconds; don’t be surprised if you are interrupted by texts and phone calls multiple times throughout your conversation. Be quick, be succinct, and if you have any chance, they will hit you back up with interest to learn more and even set up a meeting to hear you out.
5. It’s all about vision and numbers.
So after you’ve managed to land a meeting, you go in knowing these guys are short on time and attention span, so the meeting is really only going to be about two things- your vision and the numbers. Your vision is all about your product or service, what you envision it to be where you sell them on the potential and why you need their money to develop it further. When they feel they have heard enough (we never even got the chance to finish), the investors will go straight to the numbers- how much you need, your company’s valuation, projections, etc. Then comes the part where they try to grill you. If you’ve done the market research and your numbers aren’t bullshit or over-estimations, then stick by them no matter what. They will most likely tell you that your company is overvalued but look at it as if they are testing you to see how much you stand by your product. If your company has true potential to disrupt the industry, they will try to break your balls but they won’t let you go away so easily. And one last thing; know what EBITDA stands for- Earnings Before Interest, Taxes, Depreciation and Amortization.
So what became of our meeting? We went in asking for $250,000 during the first meeting. They didn’t end the first meeting in any way we could call positive, but they still wanted to meet later that day after we updated some content. We set the other meeting up in the same hotel lobby later that day where they told us they could only do $500,000. Even more, their attitude during the second meeting was completely reversed, they were calm and respectful, and we ended the meeting with a glass of wine at the hotel bar.