We continue to hear that banks aren’t lending, but there may be a good reason for this.
There is a lot in the press about SMEs and Startups seeking to raise finance directly from alternative sources such as peer to peer and crowd funding platforms.
Furthermore private investors are often receiving pitches of the blue.
All too often the fund raising pitch doesn’t provide the information needed to make a decision, or worse it is simply delusional.
Sometimes we come across statements like “we have no competition”, “we only need to capture 2% of the market”, or even “everyone needs our product”.
The (printable) responses to these are likely to be “are you are so *** brilliant that no one has ever thought of this idea?” or “could that be because no-one actually needs what you’re offering?” to the first.
The response to the other two is likely to be a raised eyebrow and a request to see what research has been done.
It seems that businesses pitching for finance often fail to understand that the only thing that really interests funders is whether they will get an adequate return. The pitch needs to be backed by solid figures and research evidence, details of who the target customer is, why the product solves their need when others can’t, why you can deliver on this promise and how this is a good market opportunity.
Have you come across any delusional pitches?
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