When looking for funding in the Middle East, it is important that you understand how to pitch your ideas to potential investors. Ideally, you should have a couple of different pitches that you can customize according to the particular background of the investor that will hear it.
One important speech is the so-called elevator pitch, a short introduction to the service or product designed to inspire greater interest. However, you also need to have a longer, more thorough pitched prepared for the investors that are reeled in by the elevator speech. Keep in mind the following key tips as you talk to potential investors:
Always include the basics.
When you pitch your ideas, it can be easy to skip over a lot of the foundational material because you have been so engrossed in it for so long. You need to put yourself in the shoes of an investor who likely knows only a little about the market and include all relevant information. While the nuts and bolts of the company may seem boring, you will impress potential investors by displaying a complete command of these details.
Some of this key information includes the state of the market, the team that you have assembled, why your solution stands out from competition, the basic business model, visions for future growth, and an overview of your financial situation. If possible, your pitch should include a demo or at least a mockup of the final product.
Focus on building trust.
Often, entrepreneurs spend the majority of their pitch explaining how the technological aspects of their product or service actually work. Although it is important to touch on these points, investors are more interested in knowing about the state of the market and how this particular product will beat out the competition. You should spend a lot of time talking about the past and the likely future of the market. Then, you should methodically look at the competition and the solutions that they offer. Doing this builds trust between you and the potential investor. Trust is the essential ingredient in a healthy business relationship, and investors are much more likely to give money to someone they trust to keep on top of the market and quickly adjust to changes when appropriate.
Present information honestly and thoughtfully.
Sometimes, entrepreneurs try to make a great impression on investors by playing with numbers a little too much and end up making promises that they cannot possibly keep. Savvy investors will quickly see through overstatements and any semblance of trust will be dashed. Thus, you need to be careful to never misrepresent yourself or your products. When investors ask questions, you are better off taking a small amount of time to think about an honest, accurate answer rather than offering meaningless filler or making up numbers. You should be able to explain the reasoning behind any decision or business move you have made clearly and succinctly. Demonstrating honesty and thoughtfulness is a key aspect of building trust.
Always remain current on research.
Honesty and integrity only takes you so far. If you cannot answer basic industry questions posed by investors, then you will not likely seal a deal. You should walk into the pitch with a clear understanding of what drives the industry and how recent news items could affect these drivers in the future. In short, you need to be able to anticipate the needs and desires of customers, which means keeping a finger on the pulse of all relevant markets. Investors understand this fact and will almost always test entrepreneurs with industry-specific questions.
Research also involves learning about the people to whom you are pitching. Under some circumstances, such research proves impossible, but when time allows you should look at the history of the potential investors and the types of projects that they like. Understanding the investor will make a good impression and demonstrate your drive.
Do not underestimate the difficulty of the market.
In the Middle East, entrepreneurs tend to think that markets are easier than they actually are. Not uncommonly, investors often hear from entrepreneurs that they do not need a marketing strategy beyond word of mouth or that they do not have any competitors on the current market. Statements like these demonstrate overconfidence and show that entrepreneurs have failed to do necessary research and think carefully about their products.
Entrepreneurs in the Middle East also frequently think that products and services that have worked in other markets, such as Europe, will clearly work in the region. Do not make this assumption. You always need to clearly demonstrate that a need for your product exists. The Middle East is a complex market, and a product or service that succeeds in one country may not do so in another. To build the investor’s confidence, you need to show that you have done the necessary market research and demonstrate a need for the product in the target market. You also need to describe any thought process about expanding into new markets and beyond the Middle East.