Investors questions to address

I picked up this great list of questions courtesy of a VC at what was then Softbank Ventures many years ago. So long ago that I’ve forgotten his name if I ever knew if, so I can’t give credit for it.

But even after all these years I still find it a useful tool to use with entrepreneurs.

A list of questions that a pitch to a VC should address

1) WHAT IS YOUR VISION?

– What is your big vision?

– What problem are you solving and for whom?

– Where do you want to be in the future?

2) WHAT IS YOUR MARKET OPPORTUNITY AND HOW BIG IS IT?

– How big is the market opportunity you are pursuing and how fast is it growing?

– How established (or nascent) is the market?

– Do you have a credible claim on being one of the top two or three players in the market?

3) DESCRIBE YOUR PRODUCT/SERVICE

– What is your product/service?

– How does it solve your customer’s problem?

– What is unique about your product/service?

4) WHO IS YOUR CUSTOMER?

– Who are your existing customers?

– Who is your target customer?

– What defines an “ideal” customer prospect?

– Who actually writes you the check?

– Use specific customer examples where possible.

5) WHAT IS YOUR VALUE PROPOSITION?

– What is your value proposition to the customer?

– What kind of ROI can your customer expect by using buying your product/service?

– What pain are you eliminating?

– Are you selling vitamins, aspirin or antibiotics? (I.e. a luxury, a nice-to-have, or a need-to-have)

6) HOW ARE YOU SELLING?

– What does the sales process look like and how long is the sales cycle?

– How will you reach the target customer? What does it cost to “acquire” a customer?

– What is your sales, marketing and distribution strategy?

– What is the current sales pipeline?

7) HOW DO YOU ACQUIRE CUSTOMERS?

– What is your cost to acquire a customer?

– How will this acquisition cost change over time and why?

– What is the lifetime value of a customer?

8) WHO IS YOUR MANAGEMENT TEAM?

– Who is the management team?

– What is their experience?

– What pieces are missing and what is the plan for filling them?

9) WHAT IS YOUR REVENUE MODEL?

– How do you make money?

– What is your revenue model?

– What is required to become profitable?

10) WHAT STAGE OF DEVELOPMENT ARE YOU AT?

– What is your stage of development? Technology/product? Team? Financial metrics/revenue?

– What has been the progress to date (make reality and future clear)?

– What are your future milestones?

11) WHAT ARE YOUR PLANS FOR FUND RAISING?

– What funds have already been raised?

– How much money are you raising and at what valuation?

– How will the money be spent?

– How long will it last and where will the company “be” on its milestones progress at that time?

– How much additional funding do you anticipate raising & when?

12) WHO IS YOUR COMPETITION?

– Who is your existing & likely competition?

– Who is adjacent to you (in the market) that could enter your market (and compete) or could be a co-opted partner?

– What are their strengths/weaknesses?

– Why are you different?

13) WHAT PARTNERSHIPS DO YOU HAVE?

– Who are your key distribution and technology partners (current & future)?

– How dependent are you on these partners?

14) HOW DO YOU FIT WITH THE PROSPECTIVE INVESTOR?

– How does this fit w/ the investor’s portfolio and expertise?

– What synergies, competition exist with the investor’s existing portfolio?

15) OTHER

– What assumptions are key to the success of the business?

– What “gotchas” could change the business overnight? New technologies, new market entrants, change in standards or regulations?

– What are your company’s weak links?

 

 

Author: Mentorphile

Mentor, coach, and advisor to entrepreneurs, small businesses, and non-profit organizations. General manager with significant experience in both for-profit and non-profit organizations. Focus on media and information. On founding team of four venture-backed companies. Currently Chairman of Popsleuth, Inc., maker of the Endorfyn app for keeping fans updated on new stuff from their favorite artists.

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