Dear Diary,

What role will the pitcher’s personality play in getting an investment from the dragons? Is there a lot at stake to risk injecting a bit of professional arrogance into your personality? Is it okay to assume that as a professional at what you do, that the dragons have no right to question a few of your claims and declarations? How prudent is it to assume that you know better than the dragons? How wise would it be to lock yourself in an argumentative duel with one or all of the dragons?

Well, I don’t have all the answers, after all I’m just a humble den sweeper’s alter-ego, but one thing I know for sure is that for a package to be considered interesting, the wrapping must be attractive and appealing. And talking about attractive and appealing, I am not suggesting that you blow your entire savings on an expensive designer suit: No, not at all, because I’ve seen a lot of pitchers (in business) in very expensive suits with very cheap personality, and less-than-a dime attitude. But there’s a need to look the part you preach. You need to look smart, reliable, and worthy of eliciting confidence in your business. You can’t expect to walk away with N10 million, looking like someone who’s never laid hands on N5, 000 before. But then if a business suit will make you irritably cocky, please wear something that makes you look good but still gives your ego enough room to practice some modesty and humility.

The first presentation you make is of yourself. You are your business idea. You are your business plan. You are your Power Point presentation. No projector or slide will sell your idea or business better than your personality, so BE your business, and BE your presentation.

Believe me; you’re apt to have a more attentive audience with the dragons, if you engage them with a likable personality. Let them see the business idea IN you and through you. Be your own business advocate, speak for your NUMBERS, as well as have your numbers SPEAK for you.

Bear in mind that the more money you ask for, the more research you are expected to have put into the business idea you’re pitching. The more money you ask for, the more passionate you’re expecting to be. The more money you ask for, the more precise with figures you’re expected to be. The more money you ask for, the more professional and experienced you’re required to be in the field of the proposed business. And the less equity you wish to part with, the more resources and business mechanism you need to have already put in place for the effective running of your proposed business.

Above all, arrogance and over-confidence may not help you. A positive, polite, and likable attitude may guarantee a more successful pitch.

 Finally, just try the magic of a charming smile now and then.

Good luck!

–The Den Sweeper

I need money!

I have a wonderful business idea that is worth more than 40 million naira on paper, but currently worth nothing in reality, and to transform this ingenious business idea into a real business I need 10 million naira. My projected income is approximately 10 million naira monthly, if only I can secure the funding I need. But then an investor is ready to offer me 10 million naira is exchange of 80% equity in this business. Meaning that he will own 80% of my business. He will have 80% control, and he will do 80% of the work! No way, it’s an ugly rip off. I can’t offer anything more than 30%…no way!

I don’t care if he’s bringing his expertise. I don’t care if he’s brought 100% of what we’ll use in starting this business. I don’t care if he’s putting in 80% of the work required to make this business manifest. I don’t care if the business is currently worth NOTHING. I don’t care if he’s taking a 100% RISK with 100% of his money, investing in a yet-to-exist business. I don’t care!

I think the problem is that I think and believe my business is worth the figures I’ve put down on paper. I see the profit, but I don’t see the risk, and I don’t see the obvious: it’s not even a business yet. Yes, right…why should I give an investor 80% of my business, even if he’s taking 100% of the risk? So if I make 10 million naira monthly, automatically, I’ve given him 8 million naira monthly. That’s not fair! I can’t accept that! But what have I forgotten? I don’t even have a business! I need his 10 million naira to make the business happen, or the business will just die like one of my previous business ideas that met with a solid brick wall when it came to the issue of finance. Let’s look at it from a wise man’s angle. First of all, I’ll ask myself the following questions:

1.        How much am I currently making from the 100% ownership I have in the business? And if my answer is NOTHING…not a single farthing! Then, I’ll ask:

2.        How much will I make (independent of the investor’s money) within the next one year? And then again if my answer is between NOTHING and ABSOLUTELY NOTHING, then I’ll ask again:

3.        How much will the business be worth within the next one year with the investor’s money (N10, 000, 000)? And if my answer is that the growth rate of the business is about 100% ROI (Return-on-Investment) on the first month, 200% ROI in the second month, 300% ROI in the third month etc? And if from my calculations, I figure that somehow within the next 4 months, the business may be worth well over N40, 000, 000; then I’ll ask myself:

4.        What is 20% of N40, 000, 000? And if my answer is N8, 000, 000; then I’ll ask myself:

5.        What will the 100% of my business be worth within the next 4 months (or even 1 year) without the investor’s money? And if the figures in my answer say  NOTHING or anything less than N8, 000, 000; then I’ll ask myself:

6.        Is 20% of N40, 000, 000 WORTH more than 100% of NOTHING?

I’ve been thinking about this all day, because I have a business idea to pitch to an investor, and I need to be sure before I decide on how much control of my business is worth giving away for N10, 000, 000. If you’re pondering what I’m pondering, then we both need each other’s comments on this!

P.S: As you know, I’m not a financial expert, I’m just a humble den sweeper, and therefore I make no claims to the soundness of the business logic imbedded in the above reasoning!

–The Den Sweeper 

 **photo courtesy of www.flickr.com