How To Really Get Your Invention Idea Percolating: Actionable tips on how to get into the right mindset about investors and then absolutely crush your pitch
Sometimes that perfect idea is burning in the mind of the inventor with so much intensity it becomes difficult to focus on anything else. Finally, after an investment of time and sweat, the concept and design are complete and all that is left to give the newborn invention wings is start up capital to get the patent, develop the idea further, work out licensing deals, and begin to advertise the product in a commercial market. What better place to gain wing-related investment help than to turn to the “Angel Investor.” All of the hard work is behind the inventor and now it should be relatively simple from here on it.
In a perfect world, maybe.
This article is broken down into two sections:
Let's first look at some more outside-the-box ways to consider and approach the investor pitch. This is all about getting in the right mindset to have the strongest possible conversations that lead to sales and funding.
There is a lot in this article. It takes some turns and provides perspective on a number of different levels. I hope you take this seriously, it can truly mean the difference between getting funded and getting booted.
Every Time the Cash Register Rings an Angel Gets Their Wings
The great news is that you as the inventor know more about your product than anyone. When your entrepreneurial spirit is combined with a strong marketing and sales background, or even a mediocre sales ability with a great deal of enthusiasm, it will certainly help.
Not so good news comes in the form of avoiding the “invention mill” of so-called investors and friends to ingenuity. There are websites which have logos from all types of sponsors and a few great testimonials from Angels and huge corporations who helped someone take their invention to market. Many investors are friends to the inventor because they want to invest in exciting new ideas which will make them money. Unfortunately the “horns” do not always show from underneath the halo, so using a little extra precaution is a great idea for inventors.
An Ounce of Retention is Worth a Pound of Obscure
If a new invention is going to be taken to market and investment money is required, a thorough and convincing business plan is necessary. One important tip to remember is that the invention, its makeup and its uses are not nearly as familiar by those who are being “pitched “ as they are to the inventor who is doing the pitching. If a detailed business plan is presented, it will explain marketing strategies, target audience for potential customer base and will serve as a “how-to” to make the new invention a success. The who, what, when, where, and why are already in the plan and the “how” is coming from the people now holding the same identical set of cards as the inventor.
In order to not lose the rights to the patent or concepts of the business, strategy safeguards are needed to make certain the angel really does have wings. Without preventative measures in place, the loss of copyright for key selling concepts would make the invention obsolete to the inventor.
Here's why this plan is a crucial tip: The inventor and potential investor have the same business plan after it is presented, so the secret invention and concept is no longer a mystery. Unfortunately it is the financier who holds the upper hand-because it is filled with the cash necessary to develop the entire business plan you created. So get on the same page!
A Shot Across the Bow
Before you pitch your potential investors, conduct as much background research as you can to make sure anyone you will potentially bring into the inner-circle is worthy of the invitation. Ask others who have dealt with potential investors, organizations which rate them, find out all company brands affiliated with the individual and do the same background checks. You are interviewing a potential soul mate for your invention; this is not a time to be sloppy.
Before meeting with any investor group and discussing or pitching ideas, concepts, presenting projections, business plans, production specific information, basically anything other than the weather and sports, a warning shot needs to be fired in order to let the people know you are serious about confidentiality. Even though most professional investors may not be willing to sign a confidentiality agreement, one needs to be presented. Consider the gesture posturing - which is very important during the process of finding investors.
Even though many investors may not be willing to sign a confidentiality agreement does not mean they are unethical. Many times they may be working on similar projects and it may block them from moving forward, limiting their chances for success with various ventures. Regardless, they will take you more seriously.
Let them know you are serious about confidentiality: Even though most professional investors may not be willing to sign a confidentiality agreement, one needs to be presented
How to “DUP” Your Way to Security and Peace of Mind
In sports there are many examples of how important a great defense is. When it comes to bringing a new product to the market the best example to use would be boxing. If the inventor is not able to secure his patent and business strategy, the contest will result in a knockout of the new idea and the visionary will be counted out.
It is imperative to put a 3-front defense in place in order to protect yourself at all times. Design, Utility, and Provisional Patents may be the difference in leaving without and check (and potentially losing ownership of the idea), or showing a strong defense and winding up with a check and a new venture capitalist type partner in success. The best way to be safe is to “DUP” the potential idea mugger - so for your own peace of mind, remember DUP: Design, Utility, Provisional Patents.
Safe by Design
To an inventor, ideas and thoughts are molded through a great deal of effort and ingenuity but it is ultimately the love of creating which brings that “special recipe” into the design of a product.
A Design Patent will protect the way a product looks and prevent “knock-offs” from being produced. Why go into a room filled with money people and show them a great new product design and expect fate to take care of making sure everything comes out fine? Designing a great defense against patent infringement is simply the smart way of moving forward.
Turning on the Utility
Utility Patents protect the way an item works or is used. When handing off a map titled “how to take my new product to market,” it is best to make certain the concepts of functionality and operation are safe and secure. Although it is impossible to fully protect any idea which can’t be clearly defined, a Utility Patent is a great way of showing the seriousness of protecting the business model, which has been recorded, prior to exposure to multiple sets of new eyes.
Provisions - Inventors can Survive on a Budget
It is the old faithful two word combination which just gives the brilliant innovator that peaceful, easy feeling…”Patent Pending.”
A prototype is not necessary in order to start the ball rolling for the patent process. The fact that the process is already underway will put everyone on notice that due diligence has been done. It may as well read "hands off", because that is the message. Be sure you have some form of the PPA or patent process started before you pitch to investors.
A Picture is Worth a 1000 Words and Potentially Millions of Start-Up Dollars
Having great detailed and specific drawings does not only help secure the new technology from being pirated, they also provide a tremendous selling tool. (Don't forget, if you've applied for a PPA already you have the diagrams - just tweak them for sales tools now)
Potential investors might have pages of graphs and forecasts but it might be the need for visual validation which opens the eyes to the value of the product.
But here's the tip within the tip: Bring the drawings that show the idea the best, not necessarily the ones used for the actual patent process. If someone has access to the exact set of drawings they might know how to create drawings which are different enough to create clouds for a "knock off" patent. Keep some cards locked away, they might never realize you have an "ace" of a patent drawing unless you need to play it later to protect your idea. Remember, not every investor walks the straight and narrow.
Act As If You are The Only
Confidence and competence are key factors to more investment support and also necessary to scare off any potential pirates. Even though inventors may be new to meeting with money people they must create the appearance that nothing can happen with this invention without the idea man who brought it to life. Until that level of comfort and ultimate self confidence arrives, there is a necessity to “act as if “ they are already in place.
These rules must be carried out without arrogance but rather by exuding confidence-even if there is none there. Any sign of weakness might prevent the best deal from being signed and may even eliminate any chance of landing the financial backing which is needed. When it comes to getting the necessary investment capital, "act as if" you know someone will jump on your idea. Eventually, you can stop acting, because it will become a reality. Use the same passion you have for your dreams of invention to help land the "stuff dreams are made of"...strong financial backing.
Regardless of where you are in the invention process, we are here to provide reliable, professional and personal advice
Now let's dive into some of the most basic and fundamental tips to put into action while preparing and delivering your pitch...
The success of your pitch depends on the type of investors involved, and how well you present your invention or idea to them. Generally, potential business partners and investors do not take more than three minutes to assess your presentation and decide whether they are interested in hearing you out or not. 3 minutes. That's not a lot of time, but the truth is that it's right in line with society. Think about it -have you ever got to a website page that didn't have relevant information (or at least interesting information) right away? How long did you stay - 5 seconds? 3 minutes is an eternity!
If the investors decide against your favor early, they basically tune out your presentation completely within that first few minutes. For an inventor looking to win investors over and sell his invention to them, it is crucial to capture their full attention with these three crucial minutes. So make the front-end of your pitch extremely strong and relevant. Think about Shark Tank - you can actually learn from how the good entrepreneurs kick things off; they keep the Sharks' interest.
To attain success in pitching your invention to potential investors, it is also important to be clear and concise in your presentation. Having a brilliant idea but not having the ability to sufficiently and succinctly communicate it in a comprehensible manner will never convince an investor to commit to financing your project. Engaging and lively pitches will always be more likely to appeal to potential investors.
To successfully pitch your invention to potential investors and partners, lock down the following 7 tips...
Generally, investors want to be privy to your plans from out of the gate. Investors cannot and will not stay invested in a business forever. For one, they get bored, and they are always on the lookout for better investments. Hence, they always want to know, in direct terms, the length of time it will take for them to get a return on their investment. They usually favor a safe and short time frame – say five years. Believe it or not, a well devised presentation, detailing the exit strategy and which answers the unstated questions of the investor, is usually the clincher on any compelling pitch.
A successful pitch is centered on one goal alone – to be so good and compelling enough to make potential investors beg and compete among themselves for the sole right to finance your invention and invest in your invention ideas. Adequately and successfully delivering what investors require and want is the epitome of an irresistible pitch.