Want Venture Capital? Avoid These Statements

By  |  0 Comments

Venture capital is arguably the most essential resource for entrepreneurs that aspire to build a successful startup. Unfortunately, investors don’t just give this away; they must be earned by virtue of a startup pitch.

Seth Talbott, a veteran entrepreneur, has experience delivering these pitches, and a fairly strong grasp on what works and what doesn’t. The following statements are contradictions that he recommends avoiding:

1. “We have no competition.”

This statement gives investors the impression that you didn’t do your homework on the competitive landscape well, or at all. Despite thinking you have an innovative idea, it’s imperative to assume that competitors already know about it. In other words, don’t gloat about the uniqueness of your product, but rather be skeptical. An added bonus? An understanding of prior failures in the industry makes you appear more credible.

2. “No one can copy us.”

Arrogance and ignorance are written all over this phrase. Keep in mind that larger companies like HP, Microsoft and Google are capable of copying the idea. Furthermore, establishing patents can be an expensive and distracting process.

3. “We will be profitable in one year.”

Unrealistic predictions will not be in your favor. Investors are aware of industry norms in regards to profitability. It’s best to elaborate on your understanding of labor costs and why your business would be able to exemplify commendable growth.

4. “We are cheaper.”

Starting a business with this mantra is a turnoff to investors. It suggests that you don’t have an understanding of the cost of starting or maintaining a business. Not to mention, why would you want to come off as cheap, when you can be valuable?

Be wary of these statements as you prepare your startup pitch. Note that it’s not the ignorant statements that will cause your startup to fail, but rather it’s the ignorant convictions behind them that cause the final blow.

Get to it. Say hi to Mark Cuban for us when you get on Shark Tank.

To see Seth’s full article, click here.

You must be logged in to post a comment Login