You can’t expect your business to have a constant hockey stick growth.
The critical success in ensuring a constant company and business growth is in learning to recognize disruptive trends in the industry and market and to acknowledge your past and present status involved.
Getting the money is somewhat straightforward – if you have a great idea, get caught in a current trend, and can present an effective plan, you will find an investor somewhere. The key point that varies here is the value you will be receiving.
We’ve seen hundreds of companies gather vast rounds of investments, whether crowdfunded or from venture capitalists that crash and burn without making any impact on the market. Many of them didn’t leave their startup phase, not to mention crossing the profitability margin.
We’ve seen hundreds of companies gather vast rounds of investments, whether crowdfunded or from venture capitalists that crash and burn without making any impact on the market. Many of them didn’t leave their startup phase, not to mention crossing the profitability margin.
Where the Problem Lies
Businesses chase after investments to improve or develop their business. And when making a pitch deck, they tend to focus on the wrong end- the investor end.
The biggest mistake with pitching for investment is to focus on investors rather than your customer value and potential business growth. In booming markets where startups and company mergers are inevitable, your investor’s decision will be based on whether your IPO value is projected to be high or if a safe exit strategy is in place. By focusing on this, you are pitching for the worst possible outcome.
Businesses starting out don’t handle enough data to process it into legitimate growth projections and therefore rely on third-party resources. To mask the lack of data, they make predictions based on temporal KPIs such as conversion rates, cost per acquisition, etc., which can be calculated in a short time sample. And therefore, their projections are as temporal and uncertain as of their KPIs.
To ensure a substantial investment to grow your business, you need to present your business value and profitability before pitching. You need to show you can earn money to make money.
The Difference
Even though there are disruptive technologies that are shaking the core of every industry, it will take time for them to mature. Startups and business today who plan to profit from these technologies are targeting smaller user bases, and their growth is somewhat limited. They won’t become profitable for at least five years even if they score a considerable investment from one or more VCs.
Business today that provide solutions for well-known problems for which the market is already in place and the answers are known, have a much higher competition. The only thing that differentiates them from the game is the experience they provide and the value they bring to their customers.
It is precisely what you need to measure, optimize and present in your pitch deck to investors. These metrics project and offer a long-term value that you can bring to both your customers and investors. And they bring you a step closer to closing an investment deal that is sustainable and focused on consistent growth rather than blitz scaling.
Although logical and comprehensible, this setup takes years to master. That is why it’s always best to advise a professional to analyze and advise you through the whole process to ensure a valuable investment. Blackhawk Partners can help you as a private equity investor and strategic advisor to grow your company.
By :Â Ziad K Abdelnour
Ziad is also the author of the best selling book Economic Warfare: Secrets of Wealth Creation in the Age of Welfare Politics (Wiley, 2011),
Mr. Ziad Abdelnour continues to be featured in hundreds of media channels and publications every year and is widely seen as one of the top business leaders by millions around the world.
He was also featured as one of the 500 Most Influential CEOs in the World.
