Shark Tank is a show which can be highly instructive to those seeking angel investors. There are sensible reasons the “Sharks” don’t “bite” on a concept. A product can simply be something they are not interested in. Maybe they can’t get excited about the idea because they don’t feel a personal connection, or the concept founder comes across as too indecisive or arrogant. Guess what? The same thing can happen when seeking angel investors for your great idea.
As a personal brand strategist who helps founders develop a personal brand strategy and narrative to attract investors, I’m a strong believer that Interest Breeds Authenticity. A founder can instantly build a bond with a prospective investor if they have a compelling story, and have done their homework so they have their best opportunity to connect.
Why is building an emotional connection to the investor important?
Unlike in a Series A or B funding round, in the initial investing stage, there is usually not much for the angel investor to go on…an idea, maybe proof of concept, a pitch deck…what they primarily have is YOU, the founder. It’s often the investor’s emotional connection to the founder, their gut instinct, which can be the deciding factor to “invest” or “not to invest”.
Recently, I attended StartUpOneStop Breakfast with an Angel. I asked Mike Edelhart, an angel investor and lead partner at SocialStart, how much does the investor’s emotional connection or intuition play in deciding to invest? He said, “It’s critical.” He went on to say that investors are watching hundreds of pitches, so founders need to find a way to stand out from the competition to gain an investor’s attention. He also cautioned attendees that it’s not all about the technology. Mike shared how some founders get so focused on creating the perfect pitch deck, they never share anything about themselves nor engage investors by asking questions, which comes across as being self-absorbed and unaware. He brought up that making an emotional connection is crucial, sometimes even more important than the concept itself. Your idea might not be the greatest, but if you make a great impression with investors, they may think of you when another opportunity arises. At the end of the day, Investors Invest in People.
Three Ways Founders Strike Out with Investors
You get one turn at bat to pitch your idea. As a personal brand strategist, it is my job to help my clients tap into their unique perspectives, skills, talents, and expertise to help form a brand narrative that is clear, compelling, and positions them as an expert, and is true to who they are. I find there are three main reason founders swing and miss, and strike out with investors:
Clarity: A founder may be a great technologist or practitioner, but when talking about what they do, they focus on technology or process over content. Many people don’t clearly communicate who they are and their story in a simple, compelling manner which people can understand and relate.
Reluctance: Some people don’t share anything about their personal story because they are not used to exposing their inner-self. People can be too modest or afraid to share their accomplishments, discount or not explain their life experiences. A startup is emotionally, physically, and financially stressful. How well you dealt with failure or overcame adversity is just as important to the investor as proof of success. Sharing personal experiences should tie directly to what you are trying to accomplish with your business.
Chasers: Some people can come across as money grabbing. A hyperfocus on chasing the cash can be perceived as being self-absorbed, self-centered, and lacking the leadership skills necessary. On the other side of the coin, Angels can sense when someone is making fear-based decisions and comes across as being indecisive and lacking confidence. There is a fine line between an effective leader and someone who is asking for investors for the wrong reasons.
Building the Connection
It all starts with having a clear personal brand strategy and narrative focused around who you are, what you do, and what’s your story. As a founder, you must be prepared to pitch anytime and anywhere to anyone who can recommend, refer, or invest in your business. You connect emotionally through shared interests, experiences, or passions. If you stand out from the competition, an investor will listen and take notice of what you are pitching. We all have unique experiences and stories about how we got to where we are today. For example, maybe you are a pilot, a veteran, suffered a traumatic career set-back, or survived a life-threatening accident or illness. Perhaps you come from a family of entrepreneurs, or went to the same university as the investor, overcame a learning disorder, or have family that has personally invested in your idea. These are emotional hooks that make people take time to listen, and want to help or invest in your business.
Do Your Research
Take the time to practice your pitch. Test it out with others. Can someone who has minimal knowledge of your concept get it? Practice with test subjects to see if they make a connection with you during your presentation. Note what increases interest, and when people are tuning out. Listen to the questions others ask about your concept. Odds are, if a test subject has a question, an angel investor will probably have the same question. Watch a little Shark Tank. See how other founders bond with the Sharks, how they stand out in the ocean as prime catches. A little research can help you reel in your angel, and make it big.
Frankly, if you can connect to investors on a very deep emotional level and make the investor get a little teary-eyed…. even better. Remember, an investor is taking a big risk on YOU. Therefore, you need to show proof you have the ability, drive, understanding, and stamina to overcome future adversity and go the distance to see a business succeed.
Questions: Do you get the blank look stare when you pitch your idea, or are investors on the edge of their seats? What is your process in doing research on investors’ backgrounds to find common interests and passions? Share your answers on Twitter or Linkedin.
About Andria Younger
Andria Younger is a personal brand strategist. Andria provides personal brand consulting services to entrepreneurs, consultants, CEO, and founders on how to monetize their expertise and build their online reputation. Follow Andria on Twitter.