According to entrepreneurship training facilitator, Lerato Matsau, the art of pitching for funding requires a businessperson to be humble, honest, prepared and knowing how to use time well. Matsau was speaking at an Art of Pitching masterclass for SMMEs in the Free State, which was hosted by the Small Enterprise Development Agency this week.
It is one of nine different masterclasses which will be hosted across all the provinces. Its aim is to impart knowledge to SMMEs that will greatly increase their chances of pitching for investment funding successfully. Matsau said that SMME owners should not sell fiction. They should be transparent with all the information they provided.
“People who are investors have seen so many pitches that they can tell when something is not right,” she said. “They want to see that you have prepared yourself,” Matsau said that entrepreneurs must be prepared to answer very thorough questions in their pitch.
“You must provide a business model and inform them (investors) how you will make money, and what your revenue streams are,” she said. “They want to see real numbers, and you can’t cheat or make estimates because they will find out. “Investors want to know what you’re going to spend your money on, how much money will be coming in, how much money you want and how you will pay the investment loan if you are applying for one,” Matsau explained.
It was crucial that investors noticed a pitch. “You must be innovative and tell a unique story of underlying magic that captures their imagination,” she said. Presentations needed to be professional, concise and had to cover all aspects of expenditure.
“It is important that you present why you are doing this business, why there is a need for it and why there is a market gap, if any,” she said. “One must also know what is the market (size) and traction, what their current market is, who their target customers are and how you are going to reach them.
“You should be able to know if there is market excitement and what your price, volume, quality and delivery are,” she also said. Matsau also advised would-be pitchers to use their time wisely and be professional. “Less is more. When you do your pitch deck, rather have less information and then spend time talking about it,” she said. “Take care of your time. Grabbing attention is key and then the detail comes once the interest is awoken,” she pointed out.
“I listen to people’s pitches sometimes and (I) cringe because they have good ideas, but the manner in which they are presenting does not come out in a way that would make an investor want to believe in them.”