Most common question investors ask during a pitch:
🚨 How are you going to use this money?🚨
Getting this wrong kills your whole pitch.
And 90% of startup founders answer it poorly.
Here’s how you nail it 🧵
🚨 How are you going to use this money?🚨
Getting this wrong kills your whole pitch.
And 90% of startup founders answer it poorly.
Here’s how you nail it 🧵
First off — this is trick question!
What investors DON’T want to hear:
❌ “Here’s a breakdown of our expenses over the next year”
❌ “We’re going to pay ourselves a salary & work on this full-time”
❌ “It’s all going to a dev agency”
Instead, they're looking for 2 things ⬇️
What investors DON’T want to hear:
❌ “Here’s a breakdown of our expenses over the next year”
❌ “We’re going to pay ourselves a salary & work on this full-time”
❌ “It’s all going to a dev agency”
Instead, they're looking for 2 things ⬇️
What investors DO want to hear:
1/ How you're turning $1 of investment into $5 tomorrow
2/ The "fundable milestones" you're hitting
Let's break these down...
1/ How you're turning $1 of investment into $5 tomorrow
2/ The "fundable milestones" you're hitting
Let's break these down...
Investors are money-motivated.
Sounds obvious, but will all the fluff that VC twitter sells, founders forget that successful investors & funds are motivated by financial returns above ALL else.
When you position your success, frame it in terms of dollar value 💰
Example ⬇️
Sounds obvious, but will all the fluff that VC twitter sells, founders forget that successful investors & funds are motivated by financial returns above ALL else.
When you position your success, frame it in terms of dollar value 💰
Example ⬇️
"This $500k investment gets us to $400k in revenue in 18 months"
This instantly frames the investment positively & shows investors how their money turns into more money
This works great for angels & smaller investors.
But big funds care about "fundable milestones" ⬇️
This instantly frames the investment positively & shows investors how their money turns into more money
This works great for angels & smaller investors.
But big funds care about "fundable milestones" ⬇️
The avg startup needs multiple funding rounds to succeed.
Good funds know this — so profitability isn't the immediate goal.
"Fundable milestones" are milestones you need to hit to successfully raise your next round. These are usually unique to your startup.
Quick example ⬇️
Good funds know this — so profitability isn't the immediate goal.
"Fundable milestones" are milestones you need to hit to successfully raise your next round. These are usually unique to your startup.
Quick example ⬇️
Let's say you're building Uber 🚗
Your success is based on...
• The # of riders on Uber
• The # of drivers on Uber
• The total amount of money people spend on Ubers (aka GMV)
• High retention (riders use Uber again & again)
Your success is based on...
• The # of riders on Uber
• The # of drivers on Uber
• The total amount of money people spend on Ubers (aka GMV)
• High retention (riders use Uber again & again)
An investor asks —> how are you going to use this money?
Perfect answer 👇👇👇
"We're using this $500k round to reach...
• 5K drivers on Uber
• 50K riders on Uber
• $5M in GMV
• 60% thirty-day retention
• $600k in total revenue
...all in 18 months."
**mic drop 🎤**
Perfect answer 👇👇👇
"We're using this $500k round to reach...
• 5K drivers on Uber
• 50K riders on Uber
• $5M in GMV
• 60% thirty-day retention
• $600k in total revenue
...all in 18 months."
**mic drop 🎤**
That's it for today!
If you enjoyed this...
• consider dropping a follow (@murtazabambot)
• RT the first tweet to help other founders who might be struggling to raise
I tweet about fundraising, startups, and our journey building @HeartbeatChat
Join me for the ride!
If you enjoyed this...
• consider dropping a follow (@murtazabambot)
• RT the first tweet to help other founders who might be struggling to raise
I tweet about fundraising, startups, and our journey building @HeartbeatChat
Join me for the ride!
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