{"id":44083,"date":"2023-10-20T15:33:19","date_gmt":"2023-10-20T15:33:19","guid":{"rendered":"http:\/\/startupsmart.test\/2023\/10\/20\/the-top-five-mistakes-founders-make-when-pitching-to-investors-according-to-jack-delosa-startupsmart\/"},"modified":"2023-10-20T15:33:19","modified_gmt":"2023-10-20T15:33:19","slug":"the-top-five-mistakes-founders-make-when-pitching-to-investors-according-to-jack-delosa-startupsmart","status":"publish","type":"post","link":"https:\/\/www.startupsmart.com.au\/uncategorized\/the-top-five-mistakes-founders-make-when-pitching-to-investors-according-to-jack-delosa-startupsmart\/","title":{"rendered":"The top five mistakes founders make when pitching to investors according to Jack Delosa – StartupSmart"},"content":{"rendered":"
\"Jack<\/div>\n

According to the Entourage founder Jack Delosa, there\u2019s one golden rule for startups when on the hunt for funding.<\/p>\n

\u201cYou must make your investors\u2019 money,\u201d Delosa says.<\/p>\n

But to do this, he says founders need to view their companies as much more than just money-making machines.<\/p>\n

\u201cYour business is an asset, not just a vehicle to generate cash flow and profits,\u201d he says.<\/p>\n

\u201cYou need to start looking at it as an asset of which profit is only one driver.\u201d<\/p>\n

According to Delosa, there are five key mistakes that founders make preventing their startup from raising capital.<\/p>\n

1. Not thinking like an investor<\/h3>\n

Delosa says entrepreneurs should ask themselves three main questions that will always be on potential investors\u2019 minds.<\/p>\n

\u201cHow might I lose my money? When will I get my money back? And how much money might I make?\u201d he says.<\/p>\n

\u201cInitially they will be scanning for any risks, so do your due diligence and assess the risks, have advisors assess the risks and come in prepared to respond.\u201d<\/p>\n

2. Going in too soon<\/h3>\n

It will take at least two or three months for a startup to become investor-ready, he says, and a lot of work is involved in this process.<\/p>\n

\u201cI could introduce you to 10 investors today but if you\u2019re not prepared, all you\u2019re going to do is burn those relationships,\u201d Delosa says.<\/p>\n

\u201cDon\u2019t go in with grandiose statements about how you\u2019ll be the next Uber by year\u2019s end, but with clearly expressed proof of concept, a strategy to get up and running and details of the team you\u2019ve pulled together to make it happen.\u201d<\/p>\n

3. Not bringing back-up<\/h3>\n

Startups that are on the hunt for outside capital need to build up a strong team of mentors and advisors, Delosa says.<\/p>\n

\u201cThe people within and around the organisation will be the number one thing on the investor\u2019s list,\u201d he says.<\/p>\n

\u201cWhat mentors and advisors are there that you can engage to build an advisory board?\u201d<\/p>\n

4. Having too high a valuation<\/h3>\n

He says entrepreneurs need to find a balance between doing their company justice and not asking for too much when pinpointing a valuation.<\/p>\n

\u201cThere is often a discrepancy between the value an entrepreneur is asking for and the valuation the investor thinks the business is worth,\u201d Delosa says.<\/p>\n

\u201cYou want to be defending a high valuation provided it is still fair and reasonable and representative of the true value of the company, but you don\u2019t want to be arguing such a high valuation that it becomes unattractive as an investment opportunity.\u201d<\/p>\n

This involves consulting with your team and outside advisors too.<\/p>\n

\u201cYou need to do your due diligence before the investor does,\u201d Delosa says.<\/p>\n

\u201cOnce you\u2019ve prepared your investment strategy, run it by your advisors.\u201d<\/p>\n

5. Not presenting an exit strategy<\/h3>\n

It\u2019s not enough to just present a strong business with traction, founders should also be showing investors when they expect to be making them money and providing an exit, Delosa says.<\/p>\n

\u201cTo demonstrate that you will be making your investors money, you need to have an exit strategy in place,\u201d he says.<\/p>\n

\u201cNominate a date or a milestone or an event when the investor has the option, but not the obligation, to exit their investment.\u201d<\/p>\n

Follow StartupSmart on Facebook, Twitter, LinkedIn and SoundCloud.<\/em><\/p>\n","protected":false},"excerpt":{"rendered":"

According to the Entourage founder Jack Delosa, there\u2019s one golden rule for startups when on the hunt for funding. \u201cYou<\/p>\n","protected":false},"author":2,"featured_media":59444,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[12,1],"tags":[],"_links":{"self":[{"href":"https:\/\/www.startupsmart.com.au\/wp-json\/wp\/v2\/posts\/44083"}],"collection":[{"href":"https:\/\/www.startupsmart.com.au\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.startupsmart.com.au\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.startupsmart.com.au\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.startupsmart.com.au\/wp-json\/wp\/v2\/comments?post=44083"}],"version-history":[{"count":0,"href":"https:\/\/www.startupsmart.com.au\/wp-json\/wp\/v2\/posts\/44083\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.startupsmart.com.au\/wp-json\/wp\/v2\/media\/59444"}],"wp:attachment":[{"href":"https:\/\/www.startupsmart.com.au\/wp-json\/wp\/v2\/media?parent=44083"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.startupsmart.com.au\/wp-json\/wp\/v2\/categories?post=44083"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.startupsmart.com.au\/wp-json\/wp\/v2\/tags?post=44083"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}