The Investment Pitch

Crafting a Story That Sells

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This section illustrates that succeeding as an entrepreneur requires the ability to market one’s company in an appealing manner. A solid elevator pitch demonstrates one’s familiarity with the firm which is helpful when one decides to hunt for investment even if they have

no immediate plans. We have provided a fair framework for creating an effective investment pitch for potential investors in this section.

Table of Content

• The need for a pitch for investments
• Recognizing the requirements of various investors
• Making an Angel investor pitch
• Revenue model overview of the products/services
• Handling the term sheet
• Post Investment management information system

The Need For a Pitch For

Investments

After the business plan has been prepared, and we are simultaneously working on the technology stack built up, we will look at the business numbers for the next few months or maybe a few years. We will also be looking at the capital required to start and grow the business as per our dreams, expectations and vision.

While the current scenario has been very violent on the private equity investment or fundraising from external investors, there are a lot of success stories where fintech entities have built powerful businesses and raised vast amounts of money from investors. Some of the most famous and recognized fintech entities have even become unicorns and taken the path to get themselves listed on the stock exchanges.

While many people consider raising capital at a very early stage, even as they develop their technological stack, they continue to consider constructing business valuation. At the same time, many people think they should start a business, put in their funds called

bootstrapping and then raise money from outside investors. There are pros and cons whether you raise equity from outside investors or not. It will depend significantly on how much risk capital you have, how much equity you are ready to dilute or how much control you can give investors when you start your business.

When young entrepreneurs start working on an idea and come from humble backgrounds, it becomes necessary for them to raise capital to support their idea. A startup will also need to increase funding

even if the promoters have a large sum of money invested for the

business expansion to be fast or the business model is such that it

would need a large sum of investment to scale up the business.
A bootstrapped fintech startup may run its operations as long as it wants. Here, we shall discuss how to raise funds for the business.

There is no standard formula for preparing a pitch deck or

investment pitch. There is also no standard format that can be used.

It all depends on what kind of prospective investor you are pitching to. Here we shall discuss some of the broad parameters which should be considered while preparing your investment pitch.

A startup fintech must understand, and the promoters must know

all the investors, whether they are angel investors or venture capital

funds for private equity funds. They meet hundreds of people yearly while the deal happens with very few of them. I have been associated with one Angel investing platform where the platform used to get almost 50 applications every month, out of which only three were presented to the investors. The chances of getting funded were hardly

one of them. Not that the other proposals were not good, but the

investors always prioritize the startups that could present better at that particular time. The fintech startup must know that pitch is crucial to get funding. The biggest challenge for a startup while making the investment pitch is the available time, the founder’s passion for their products and their ability to speak within a stipulated time since the investors give them a concise to present themselves. Hence, the pitch

must be impactful within 10 or 20 minutes. If we take the example

of “Shark Tank” they don’t even give this much time. It is important to note that the challenge is to find investors and decide what kind of investment pitch has to be made. There are some important points to be kept in mind which will help the startup founders when facing

prospective investors.

Recognizing The Requirements of Various Investors

Although there are different types of investors, venture capitalists

and angel investors are the most prevalent.

Angel investors Vs. venture capitalists

• The venture capitalists — A private equity investor known as a Venture Capitalist lends money to businesses with
  
  strong development potential of trading for an equity stake.
  
  This could involve providing beginning capital or aiding
  
  small businesses that want to grow but lack access to equity
  
  markets.
• The angel investors — High-net-worth individuals who support small companies or entrepreneurs financially are
  
  referred to as angel investors also referred to as private
  
  investors, seed investors or angel funders. These individuals often do so in exchange for ownership stock in the startup or entrepreneur’s business. Angel investors are frequently found together with an entrepreneur’s friends and family. Angel investors may contribute one-time capital to help a firm get off the ground or continue support to assist the
  
  business get through its challenging early phases.
  
  Whether you are speaking to an angel or a venture capitalist, the manner you prepare your pitch will change slightly.

Making an Angel Investors Pitch

High net-worth individuals that invest as angels act as solo investors. This means that individual angel investors generally move faster in

making decisions as they do not depend on others to make decisions. They focus more on the big picture, the possible upside, and the sizable market the business product covers while making an angel investor pitch. Generally, Angel Investors invest through platforms.

Introduction with Venture Capitalists

VCs are more meticulous, focused on the details and interested in

the numbers. They have a big responsibility to make wise choices since they are writing cheques on behalf of a group of other investors. While pitching to VCs, we should concentrate on specifics, data and potential hazards.

Getting Ready With the Right Amount of Time

Since most investors schedule meetings in advance, we will be aware of how much time we have to make the pitch. Though it may be longer, this typically lasts between 20 and 30 minutes. For instance, if you only have 20 minutes, your pitch will be substantially different than one that would’ve been made in 30 minutes. Don’t forget to prepare for the Q and A session, which is also usually scheduled for

example, there might be a 30 minute meeting with 20 minutes to pitch and 10 minutes for questions or vice versa. By giving practice

pitches to friends, relatives, or other people who are unfamiliar with your startup, you can get practice addressing impromptu Q and A.

Due Diligence on Investors

To ace your first pitch and close a transaction on the spot is a very

uncommon occurrence. Often, it will take multiple rejections from

investors before you eventually receive money. The attitude to

adopt in this situation is that you can learn something from every

interaction with an investor, including every rejection. We will pick up some tips on presenting your business, responding to typical inquiries and what information investors are looking for. We may improve the pitch and story by seeing three or four investors first. This will help us be more prepared when we do meet the investor we want to collaborate with the most. The Fintech founders must do thorough research on each investor

they are about to meet and try to learn things like startups they have previously invested in, what motivates them to think positively

and say yes and what they don’t like in a business. Their profitable investments and loss-making investments What types of inquiries they make generally and a few phone calls to founders who have worked with that investor in the past can be a wonderful place to start if you cannot uncover all this information with a quick Google search. It would be a good idea to follow their social media handles and understand their thoughts. Do not assume that all investors are interested in the same information.

Considerations For Right Investment Pitch

When pitching an investor or a group of investors, The Fintech

founder should always begin with an elevator pitch. This is essentially a one minute overview of the entire pitch you are about to make. The elevator pitch may cover some key points like, the problem statement or the issue the fintech has observed, the proposed solution the Fintech will provide, and the Key Selling Points of the

Fintech for customers and investors. By starting here, the founders will ensure that when they move to the next step, the investor is on an equal footing with the founders.

The story about the product or services must be compelling, clearly showing the need or demand for the product. Most founders find this phase very simple because they frequently have an engaging tale to share. It should demonstrate that we have understood the problem

or pain point and found the solution. Everyone listening to the story should get attached to it.

Include a section on your current team founders, co-founders,

board of directors, advisory board, and so on in your pitch. It is recommended that their experience, credentials and areas of expertise they bring to the business are highlighted. Investors will be more confident in bringing the idea to market.

One of the critical points the investors look for is that the founders must be very certain of the investment required and how it will be used. If we indicate that we are okay with whatever money we get, the investors will take it negatively. Instead, the founders should be clear with investors about the financing they need from them.

• They are looking to raise the amount of funding in USD and/
  
  or INR terms.
• The anticipated duration of this money will be enough to
  
  run the business, including some grace time to raise the next round.
  
  • What they plan to do with the money with the amount
  
  and percentage of funds to be utilized in various activities
  
  like marketing, infrastructure, team building, product
  
  development and so on.
• Where do they plan to be when the funds raised are utilized
  
  for example are they striving for profitability and won’t need
  
  more funds to be raised or reach a point where they would qualify for the following fundraising rounds.

The investors look to know the market potential of the product

and services being offered by Fintech startups. The founders must be bold when describing the market that their solution serves. The market potential must be explained by stating the size of the entire addressable market, considering all potential present and future uses of the product. After this, the numbers should be narrowed down to the Target Group or Target Audience. Generally, small numbers

rarely motivate investors, so the founders should go big with this.

However, the numbers should be realistic.

Other promises regarding market potential, addressable markets, or any financial projections should be supported by reliable data because savvy investors can spot inflated statistics when they see them. In

other words, we should be able to precisely describe the calculations and be ready to show how we arrived at those estimations. The

investors are more informed about the segment since they meet

many more people in the same or similar segment. How we intend to sell the product should be explained in the marketing strategy. How will others find out about us? And how do we intend to draw in new clients? We all enjoy novel and intriguing concepts, but investors know that the adage “build it and they will come”

is untrue. The brand’s marketing approach should be highlighted

in the pitch to prospective investors, whether it involves trade exhibitions, online or digital marketing, blogs, content marketing, channel or direct sales.

Business Plan and Projections

The Business plan should describe how the product or services

offered shall generate revenue annually for at least 3 or 5 years. An effective pitch also provides a straightforward explanation of how this model relates to targets for total annual income.

While we shall be discussing the executing summary, one of the

driving factors for investment is the financial projections of the

business plan presented to prospective investors. Finding out whether or not your Fintech will be financially viable over the short, medium and long term is one of the most crucial reasons to perform a financial forecast. By taking the time to analyze

project revenue, costs, business growth and cash flow, we can see

how the economic situation will stand after a certain amount of time, say over a period of three and five years. Additionally, while looking for investors, we will need financial predictions to demonstrate our strategy and understand when they will get a return on their investment. Financial estimates, however, should be understood not to be utterly correct since, with any kind of economic forecasting,

numerous factors could influence the predictions.

Financial predictions generally contain several data points arranged into three financial statements which are made on a monthly, quarterly and annual basis.

• Balance Sheet (Table 1.1)
• Income statement or profit and loss statement (Table 1.2)
• Financial ratios, in the case of a lending fintech (Table 1.3)
• Cash flow forecast (Table 1.4)

There is a further break up of revenue and expenses profit and loss statement, which is itemized for explanation to the investors. One common factor investors use is, asking about ‘Unit Economic’ which may drive the decision making.

Table 1.1 - Balance sheet

In Table 1.2, we can see the financial projections of a lending fintech company.

Table 1.2 - Financial Projections of a Lending Fintech Company: P&L

This table shows us the financial ratios in a lending Fintech.

Table 1.3 - Financial ratios, in case of a Lending Fintech

Table 1.4 showcases the Cash flow forecast.

Table 1.4 - Cash flow forecast

Business Risks

Talking about potential business risks is necessary while pitching to the investors, since they may raise queries on this aspect. A lot of

founders are so confident in their product idea that they neglect to

take external risk into account; however, if anyone says there is no risk at all, no investor is going to buy the idea and would consider

that the founders are not aware of the market scenario.

• Regulatory changes.
• Legal and compliance issues.
• Technological risks as the technology changes at a fast pace.
• Geopolitical risks and risks related to global situations.

When questioned, we need to be ready to discuss how we intend

to approach and reduce each of these hazards. Presenting SWOT

Strengths, Weaknesses, Opportunities and Threats analysis helps properly handle the risk factors. Most investors are always keen and interested in learning about the exit strategy, whether during the early funding phases as seed funding or the next level of angel funding and so on. However, it may not be a condition to invest. However, as your business grows

and investment numbers reach higher, this question becomes more critical for both angel investors and venture capitalists. The founders would need to mention and explain the exit options available for the investors, whether it would be by going public stock market listing, in India, the SME platform is a great option to provide exit or potential acquisition or buyback by the founders or secondary sale in

the next round of funding.

Preparing an Executive Summary

Generally, the investors or these angel network platforms would

ask for an executive summary with an overview of all the details

covered in the investment pitch, as it is usually to present to your

reader before the entire presentation is made to them. Here are vital points which should be covered in the summary.

• A briefing is a meeting for informational or educational
  
  purposes. Consequently, a business briefing is held to
  
  update staff members about new policies, goals, strategies,
  
  or assignments. In small businesses, every employee might take part in a single briefing. Store or department managers frequently hold briefings unique to their teams in larger or dispersed small business operations.
• Special purpose gatherings lack the focus of business briefings. If a retail company creates new service policies, each shop manager may brief their team on how the policies operate and instructions on implementing them. A sales manager might conduct a briefing to update the staff on a new product offering. Before taking action, a small business owner might inform his management or leadership team about a layoff or other tactical moves.
• Businesses can develop briefs for.

1. New initiatives
2. New customers
3. Investors
4. Plans for business expansion
5. New target demographics
6. Commercial loans
7. Brand awareness
8. industry-specific solutions
9. Increasing revenue

Example:

NetMoney Financials is an India-based financial technology

company with its corporate headquarters in New Delhi City. This pan India-based fintech payment system helps fintech start ups digitize their systems with rapid actions and go paperless.

They provide multi level solutions to the companies in the lending

segment and provide solutions from New Customer Acquisition to collections.

Team

• The management team is important when creating a business plan proposal for investors. The executive team will be considerably more important to the investors than the actual business concept. They know that selecting, preparing and inspiring a successful management team will determine how the business plan is implemented and whether it succeeds or
  
  fails.
• The management team’s plan includes mainly these three
  
  objectives.

1. To demonstrate that our present team can carry out
   
   the possibility described, or in the event that it isn’t to choose who must be hired to complete the current team.
2. To persuade lenders and investors—such as venture
   
   capitalists and angel investors to finance the business
   if needed.
3. To outline the best ways aboard, if any can support your team’s success.

Example:

Mr. Amitraj Khanna is a technology and business management professional having a diversified experience of more than 23 years of experience in Information Technology, Finance, and the Equity market. He is a management graduate from Shailesh J. Mehta Institute of Management, IIT, Mumbai and Certified in Data Sciences from Harvard University. The system comprises a highly experienced core team. NetMoney is continually trying to advance tech driven, creative solutions that

will empower Fintech start-ups and promote financial inclusion

throughout the nation.

Revenue Model Overview of the

Products/Services

• In terms of presenting your business investment pitch, it is
  
  critical to understand both market size and market worth
  
  if we operate a business and present it appropriately. They
  
  can demonstrate to you not only the volume of clients you
  
  can anticipate, but also the annual revenue potential of your company.
• The structure for generating income that is a component of
  
  a company’s business model is known as a revenue model.
  
  Subscription, licensing and markup are typical income
  
  strategies. The revenue model aids companies in deciding
  
  how to generate income, such as which revenue source to
  
  focus on, who their target consumers are and how much to charge for their goods.
• Because each is a separate source of revenue production,
  
  revenue models and revenue streams are frequently confused. They are also mixed up with business models which include revenue models. Business models must consist of revenue models to be complete. These models assist business owners in deciding how to manage their income streams.
• Many diverse people will benefit from a businesses’ goods and services. As a result, our business will have plenty of
  
  clients; we might even consider them all crucial. A crucial
  
  customer sustains your firm, boosts your profitability and
  
  sticks with you through good times and bad. Important
  
  clients are invested in the success of the business as a whole. They are the most significant clients we can have.

Example:

Let’s imagine that ABC Company was considering expanding its

operations. They currently make widgets, but they want to consider the possibility of making gadgets. Before beginning the production,

the company needs to determine the size of the gadgets market.

This ABC Company looked at their competitors’ sales and the
consumer as the final user to determine the market size. The ABC Company estimated that the American market for devices was

worth $100 million in 2015. By examining sales statistics from their competitors, they learned that DEF Company had $20 million in sales in 2014, whereas XYZ Company had $40 million.

Since there is a $100 million market for devices, both XYZ Company and DEF have been informed by ABC Company.

Explaining market size and opportunity for MSME lending Fintech

Key Competitors/Customer Options and Competitive Advantage Competitors

• In the pitch deck’s crucial “who are your competitors” slide, many entrepreneurs respond with either barely comprehensible or downright untrue answers. Who are your competitors is a question that needs to be investigated.
• It begins with the notion that we don’t have any competition,
  
  which is how many founders begin. Following that, the
  
  standard answer is, “Then you have no market.” Most people
  
  are reluctant to discuss other companies for fear that doing
  
  so may somehow devalue their own enterprise, as opposed
  
  to praising it. One must consider competition as a means of verifying a market.
• Maybe you already know your competitors if you intend
  
  to launch any business. Before successfully identifying the competitors, we need to understand the product or service and how it fits in the market What value does it have? What makes it unique? Once we know the offering, the following steps can be carried out to define the competitors.
• Do market research.
• Ask your clients or potential clients.
• Visit social media.
• Keyword analysis.
• Google ad.
• Search engine outcomes.

Example:

Direct competitors — Growth DirectInvest, Kwik Financials

Value proposition — Faster adoption for businesses in the early stages of the data journey; Plug-and-play compatibility with current open source data tools and technology Complete services through the platform, encouraging customers to stay with the platform.

Revenue Cost Metrics

The complete cost of producing and providing a good or service

to customers is the cost of revenue. The income statement of a corporation contains information about the cost of revenue. It is intended to show the upfront expenses related to the business’s products and services. The service sector frequently prefers the cost of revenue metric because it provides a more thorough accounting of all expenses involved in selling a good or service.

Example

FY 2021-22

Net Revenue — Rs. 4.6 Cr,

Loss — Rs. 1.2 Cr,

Monthly Burn — Rs. 16 Lakhs

Prior Revenues, Current Year Estimates and Next Year Projections

Developing financial estimates for a Fintech startup provides the

founders a significant advantage, whether for launching a new firm or making plans for an existing one. Economic predictions or projections assist new businesses in obtaining funding and determining whether or not their financial trajectory is on track. The financial projections assist the fintech in deciding whether and when to obtain capital and

forecasting future revenue and expenses for an existing business.

They also assist the company in planning future expansion.

Example

FY 22-23 Projections

Net Revenue — Rs. 15.50 Cr,

Loss — Rs. 2 Cr,

Monthly Burn — Rs. 15 lakhs.

Current MRR — Rs. 1.20 crore,

Operational. Breakeven at MRR of Rs.2 Cr

Marketing Strategy

The portion of a pitch deck titled “marketing strategy” describes the company’s marketing goals and intentions. Here, we need to explain how we intend to reach the target audience, build brand recognition and generate leads and sales. The pitch deck should have a succinct and clear explanation of the business plans. The marketing approach should be in line with the overall business strategy.

We should have a clear understanding of the marketing strategy before introducing the business products/services to the investors. This serves as the pitch deck’s framework because it directly affects the company’s potential to produce revenue and consequently, the ability to collect income for investors. The marketing strategy of a leading fintech.

Marketing or Customer Acquisition strategy of a lending Fintech

Total Funds Required and Proposed Deployment Valuation

The business’s anticipated revenue at the time of exit is the primary

input into the business valuation. The following details about the

sales and valuation of the company should be included in the

presentation slides.

• Projected Revenue
• Industry/Transaction Comps
• Comparison against DCF
• Post-Money Request
• Money Request

The information especially the revenue assumptions mentioned in the financial forecast presentation should be reflected in the projected revenue.

• Total funds required Rs. 4.5 crores, out of which raised Rs.
  
  2.5 Cr till now with SHA signed at Pre-money Valuation of
  
  Rs. 30 Cr.
• Ask for a minimum of Rs. 1 Cr to close the round at the same
  
  Pre-Money valuation.
• The balance of Rs 1 Cr shall be raised after the closure of this
  
  round.

Utilization of funds

• Technology stack improvement and development — 30%
• Marketing and Business development — 25%
• Team building — 20%
• Others — 25%

Utilization of funds - breakup

Creating Multiple Possible Scenarios

Most entrepreneurs generally make the error of developing one

financial plan and sticking to it, assuming that they have considered every aspect of the business. But we also need to plan for what might occur if things turn out better or worse than anticipated or projected.

Invariably investors ask to change the projections based on their

views and experience. Creating multiple possible scenarios will also benefit a founder and reassure investors. A solid indicator that we are financially prepared through the ups and downs demonstrates

that we are ready if things do not go as planned.

Three possible outcomes are advised for your financial projections and investment pitch discussions.

• Standard business plan — This is our working and operating
  
  business plan, which is probably what we will show to all stakeholders and investors. It is based on our fundamental
  
  thinking and strategy, along with other key people in the
  
  organization.
• Optimistic business plan — This is based on the assumption
  
  of quicker growth based on aggressive marketing, customer acquisition and sales. This is our best-case scenario. Generally, investors would not be convinced of this plan unless they see a direct advantage due to team strength or government policies supporting the segment. The latest example of this can be the Electrical Vehicle segment.
• Conservative business plan — It contains assumptions and is
  
  our “worst case scenario.” This plan is created after considering possible negativity based on the risk factors, assuming delay
  
  in the next round of equity raise, geopolitical issues, and
  
  other such concerns. While investors do not support this
  
  and do not value the company based on it, this gives them a
  
  picture of the safety of their investment in case things do not go as expected.

Follow Up With The Investors

Following up with the investors is essential for any business.

1. Initial follow-up
   
   Most of the time, we will need to persuade the investor to our business. The majority of investors won’t get in touch with us immediately following the meeting. Therefore, we must move on to the next step
   
   and follow up with them by sending an email with the information, data or documents asked by the investors and replying to the queries raised during the meeting. You may also include additional
   
   information and explanation from your end which may help them understand the business better. You may also propose another video call on Zoom or Google Meet.
2. Regular and ongoing follow-up
   
   Angel Investment platforms or investors keep getting multiple
   
   proposals for businesses similar to yours. Many investors will
   
   grow more enthusiastic about investing in the business if they keep hearing or seeing about it and get some updates, even if they would not have initially shown interest. Sending investors’ emails that go
   
   unanswered can make you lose confidence. Still, there is no harm in reaching out to them until you receive a definitive response, especially if there is growth in the business. While there is a definitive timeline of follow-up, you should send follow-ups on a fortnightly
   
   or monthly basis that should include the following.

• Information about a commitment coming in the investment round and the balance amount available.
• The new investors have shown interest, and some of them
  
  might have remitted the investment amount.
• Business updates regarding the launch of new products and
  
  services, traction, revenue generation, media coverage, and so on.

While the founders may get a no from investors in the initial round, it would be a good idea to send the quarterly update to all those who

understood the business idea but did not invest. They may consider

investing in subsequent rounds if they keep getting an update from

you. There is a saying, ‘Out of Sight, Out of Mind’ - so it is good to be in the investors’ minds.

Handling The Term Sheet

The startup founders are generally not experts in handling investments as they are good at their business or technology. Suppose you have made an excellent investment pitch and managed to convince the investors to invest in your business idea that is not the final success. The real challenge is handling the term sheet and closing the round.

It is worth hiring a well reputed lawyer who has handled this transaction and may have experience with the same kind of investors. First send the lawyer and other trusted advisors a copy of the Term Sheet. It is best to hire the lawyers with term sheet experiences, such as existing

investors and mentors. Find out whether any clauses are unique or problematic and inquire about their opinion of the arrangement as a whole. Founders typically have less experience with term sheets than lawyers and advisors. Therefore they must comprehend the validity of the conditions and any possible areas of dispute. In addition to the price and investment amount, the following terms are typically of the utmost importance: Board control, Board approvals for business budgets, employment above a certain cost or designation, reserve matters, Employee Stock Ownership Plan and so on.

Update and Inform Other Potential Investors

Since you must be in touch with multiple potential investors, it is

beneficial to inform them that you have a term sheet but would like

to complete the conversation with any other lead investors in your

fundraising pipeline. If you have more than one interested party,

negotiating a term sheet will be considerably easier. If you submit

two or more term sheets, there will be a better chance of securing your preferred terms and you simultaneously have a fallback alternative if your first choice withdraws. This also indicates that more and more investors have liked your business idea.

Having an investor, whether an Angel Investor, a VC or a Private

Equity on your board of directors is like getting into a long term

relationship that is difficult to break or exit. Hence, it is important to understand what working with this person or firm will be like. While founders run for money like crazy, it is essential to do a background check on the investors, to understand how they behave in difficult situations. If possible, a reference check should be done with the founders of the existing companies where these potential investors have already invested, whether the investee company is successful or even failed. This reference check must be done before executing

the term sheet.

For most entrepreneurs, receiving a term sheet is a significant

accomplishment so they should quickly get to the closing details, get the funds in the bank and make sure their business gets to a fantastic start as per plan and projections.

Drafting a Term Sheet

Post Investment Management

Information System

All investors, whether they are High Net Worth Individuals (HNIs), Angel investors, VCs or private equity funds, would always have a specific clause to get periodic updates about the growth in business as per the business plan. They would also want to know and get any important events or matters highlighted. Most investors also have a ‘reserve matter’ clause where some specific decisions can only be taken with the approval of these investors. A timely update on all important matters and proper detailed MIS is appreciated by the investors, especially if the founders also give their observations and analysis on the variances in the business, that is, the difference between the actual numbers and the projected numbers and the reason thereof.

Compliances

All investors would always prefer that the company in which they have invested should follow all the rules, regulations and compliances. The same should be confirmed to them periodically during the board meetings. Any non-compliance must be immediately brought to the

notice of investors, along with the reasons for the same. In any of the regulators take any penalty or action, the same needs to be resolved and informed to the investors. To summarize, the founders need to make a good executive summary and presentation to the investors that must cover all the major points

as expected by the investors. While investors do due diligence on

the investee company and founders, it is equally important for the founders to check about the investors to avoid future conflicts. The terms and conditions of the ‘Term Sheet’ are just the basic things to take care of as the subsequent Share Purchase Agreementand Shareholders Agreement have very detailed terms and conditions. They also include the process of the transaction, which is applicable after the investment is made in the Company. These are very detailed, complicated and exhaustive documents with legal

implications. While the success of a startup is generally measured by how much money the founders have raised and the valuation they created for Fintech, it is a very challenging journey for the founders hence considering running the startup by ‘bootstrapping’ should always be

the first option.

One of the most challenging parts is the Question and Answer

session with potential investors. Investor pitch meetings

usually involve a Q&A session. Despite our best efforts to prepare, we can never predict what questions the investors might have. As a smart Fintech founder, responses like “I don’t know” or “I will cover that later in the presentation” should be avoided. However, you should be aware that investors are engaged and at least partially interested when they pose challenging queries. They might even be evaluating

our quick thinking. So, when a challenging topic is posed, try your best to respond, but be humble and upfront about the fact that you were not as prepared as you could have been.
For instance, “As far as I’m aware, [answer], but because you brought it up, I should be able to provide the appropriate response. After this meeting,

let me check with you to make sure that’s accurate.”

In India, there are many Angel Investment platforms where founders can approach and pitch their ideas, some of them are.

1. Indian Angel Network
   
   A network of angel investors called the Indian Angel Network is funding startup companies with the potential to generate disproportionate value. The Network’s members are pioneers in the entrepreneurial eco-system since they have a track record of starting and running successful businesses and
   
   have extensive operational expertise as CEOs.

The Indian angel network logo

The Indian Angel Network, founded in April 2006, offers

money and continuous access to excellent mentoring, extensive

networks and opinions on strategy and execution. Due to

their backgrounds, network members are more equipped to

identify potential dangers at a preliminary phase.

2. Lead Angels

A group of three people from IIT Bombay founded Lead

Angels to support early-stage investments in start-ups. Today,

Lead Angels is a start-up provider of financial services with

a full stack. In addition to investments, Lead Advisory helps

start-ups with subsequent funding, and LA Management & LAMPS Professional Services supports these companies’ regulatory and governance needs. The team achieves this by offering investor-members expert support in company appraisal and the operations of the portfolio companies.

The lead angels logo

3. LetsVenture

With the help of LetsVenture, entrepreneurs seeking

seed funding can build online accounts that are prepared

for financing and connect with professional investors.

Additionally, the site enables startups to network with mentors

and have the platform’s experts analyze their business ideas.

Through its commitment-to-close bundle, it aids startups in

the funding closure process. LetsVenture, a company founded

in 2013, uses the capital it receives from angel investors to grow and attract additional foreign investors.

The LetsVenture logo

4. Venture Catalysts

A business called Venture Catalysts is dedicated to the

entrepreneurial commercialization of technology. The business serves as a catalyst for the development of innovative

technology-based businesses by assisting forward thinking

academics and entrepreneurs in realizing the full potential of their ideas.

The Venture Catalysts logo

5. Mumbai Angels

For early-stage venture funding, Mumbai Angels is a leading

venue for angel investing. Since its foundation in 2006, they

have assisted numerous cutting-edge and creative projects

in successfully taking off from the initial concept. They have

16 years of expertise and have witnessed several early-stage

investment cycles. As a result, they focus on the importance

of having a structured early-stage investment portfolio for

the economics to work.

The Mumbai Angels logo

6. India accelerator

India Accelerator program helps firms go from decent to excellent in the introductory phase. It is a systematic methodology that may bring the necessary mentorship,

networking, technologies, ancillary services, and lastly, the

capital. It is the only mentorship focused program in India that is associated with GAN.

The India Accelerator logo

Conclusion

This section discussed how to succeed as an entrepreneur. One must be able to pitch their business persuasively. A solid elevator pitch demonstrates one’s familiarity with their firm, which is helpful when they decide to hunt for investment, even if they have no immediate plans. We have tried to provide a fair framework for creating an effective investment pitch for your investors. This section aims to

teach readers how to build a persuasive investment pitch for their company, service or goods. The emphasis areas offered in this section will help readers cover all the essential critical points to

express to potential investors.

The next section is a gist of all the sections. We have discussed

numerous topics related to the Fintech Industry, the related

products and services. We have summarized the major components of building a FinTech business in relation to KYC underwriting standards, servicing consumers, recovering loans or dues and how to authenticate data or information provided to you regarding how to use future Technologies. We have explained the key requirements to set up a fintech company and how you pitch your idea which is a combination of finance and technology to prospective investors.