Entrepreneurs creating startup businesses must learn to pitch an investor, sell a product or service, or convince others to enter in a partnership. The process comes naturally to some while others find this aspect onerous. Many factors influence customer, investor, or prospective partner decisions to buy what you are selling. The chances of success of an entrepreneur building a startup business may be enhanced by developing the skills needed to pitch the business or product.
The same skills apply to convincing your boss to engage in a novel program, provide extra resources to an existing program, or requesting a higher salary. Job searches may culminate in a better job or higher pay by using some of the key skills important to selling. Whether marketing yourself, a business, a product, or proposing a new working relationship, the proposal should highlight Value relative to Cost. Secondly, taking time to develop a relationship and educate the other side improves the odds of success. Finally, you must show what is in the deal for them. The whole prospect of getting to a successful deal or purchase requires these factors and others.
1. Value: Value of an offering or request is more than the financial aspects. A proposal should highlight all the benefits and relate them to the individual’s or group’s needs. The proposition may relate what the person receives relative to what they must provide. For example, the work effort contributed relative to the increase in business is a means of pitching your audience. Alternatively, you may be able to relate product benefits relative to price. In making a request for funds within your organization, the need to convince your boss of the benefits of the program is critical followed by demonstrating the value of the benefits relative to the cost. Any good value proposition should highlight the superiority of your proposal relative to existing alternatives or competition.
2. Cost: Cost is always important. Pitching a deal to someone that cannot afford the product or service will translate to a NO SALE. Pre-qualifying the client or organization on ability to pay will help ensure the proposal contains the optimal pitch along with affordable costs. The costs may translate into the amount of work an organization must perform. Costs may be the cost per share in raising the next round of capital. Identify what it will cost in time, money, and effort to meet your request and ensure they fit the buyer.
3. Understanding: Relaying an accurate value proposition requires the listener fully understanding the product, field, or technology. It may require teaching or training to help educate the purchaser. This often occurs in convincing an investor to investment in your technology. It can take long sessions to educate the investor before they are comfortable enough to make the investment. The same is true for making most pitches. The listener must understand the parameters as they relate to them before they can evaluate the pitch or proposal.
4. Relationship: People regard good relationships in a positive manner. Approaching someone that you have developed a rapport with provides a measure of trust in what you are saying. The barrier to the initial approach is lower as is the ability to convince them of the value of what you offer. A great example comes in the field of job searches where you are selling yourself. Calling those you know will get a high percentage of people taking the call and providing some assistance. Calling friends of your closest contacts, following an introduction, is better than those cold calls you will certainly make. The point is that using relationships to help break the ice is a great way to improve the odds of getting to YES.
5. What is in it for them? Nearly every entrepreneur or sales person is enthusiastic and excited about his or her offering. Making presentations about a great technology or product can sound a bit one-sided if one is not careful. Your ability to demonstrate what your product does for the other person is essential to a sale. An investor must see how they will benefit. Customers must see the benefit of the product or services to them and their organization. Your boss must understand why the funds you seek for that special program will benefit the business. Show the person you pitch what is in it for them and increase the chances they will say YES!
You can follow Taffy Williams on Twitter by @twilli2861 and you can email him with questions or contact him via company contact info in the website. More Startup information is contained in his personal blog.