Ellie Henkemeyer, Emma Button and Louise Messina pitch their business concept, BrightSide Produce Distribution.

Pitching a Start-up: 10 Key Issues to Address

Michael P. Moore, director of St. Thomas' William C. Norris Institute, presented his 10 key issues to address when pitching a start-up company to investors, at the Minnesota Inventor's Congress Inspire 2015 Innovation Expo, on Thursday, April 30.

Clarity: Make a clear, concise statement of the problem and how the company will profit by providing a cost-effective solution to specific customers.

Reality: Tell your “reason-for-being” story, what you have accomplished so far, and who you will be competing with for your target customers.

Credibility: Give specifics of the founders’ backgrounds, especially what is relevant to this company, and tell about the advisors and others supporting the company.

Practicality: If your product or service is still being developed, describe where it is in the R&D stage and what specific advances must be made before it can be evaluated as a practical product or service.

Validity: Name who outside of your company (preferably potential or actual customers, partners, licensees) with knowledge of the industry has looked at your solution and understood its value.

Frugality: Show how you have used capital and human resources to date, the specific uses of the current round, and your grand plan for the company with full funding.

Accessibility: Tell how you will access your target market and describe the sales process(es) by which you will access the customers who make buying decisions (often not the end users).

Profitability: Show conservative five-year financial projections, but focus mostly on the assumptions for market entry and growth, pricing and gross margins, revenue and expenses that you used in building the projections.

Affordability: Describe how you have priced this round of equity to give investors a reasonable chance of 5x to 10x returns on their investment. Get deal advice from experienced advisers.

Integrity: Provide easy-to-understand support materials, and trusted referrals and resources to investors to help them make an informed decision about the risks of investing. Be readily available to take calls and follow-up meetings with individuals or groups of investors, but be wary of those who insist on negotiating special terms for their investment.