Attracting new investors is vital for growing your business and securing the necessary funding. To make your business stand out from the other companies (in CrowdWorks and online), you need a compelling pitch that captivates potential investors. This article will share essential tips to help you build your CrowdWorks company profile, showcase your unique value proposition, address potential risks, and demonstrate traction.
We have designed the CrowdWorks company profile to support you in pursuing new investors. We have researched what information investors seek when they are introduced to a new company and included that as the building blocks for the company profile.
Tip: you can also upload a PDF version of your longer pitch to your CrowdWorks profile.
1. Highlight how you are solving a problem - The challenge.
Clearly communicate what sets your business apart from the competition to capture investor interest. Include this information in "The Challenge" section of your company profile.
Emphasize your unique solution—the specific value or benefit your product or service offers to customers and how it solves the problem they are experiencing. Clearly highlighting your unique solution helps investors understand why your business is worth their attention and investment.
2. Market potential
Understanding the company's market potential is important to investors because it helps them estimate the future market or potential for a product or service. Investors often work in 3-5-year timelines, which you can consider when filling out your information.
Common mistakes made on the market slide are exaggeration or miscalculation of the market. We often see founders relying on third-party high-level reports/estimations. They rarely reflect the realistic size of the addressable market. Factors like competitors, pricing and specific market segments are often not considered.
We advise founders to try to
be as conservative as possible
identify your target markets and their size
back up top-down calculations with bottom-up calculations
And take advantage of the autogenerated circle graph! By adding your numbers, you will get an eye-catching graph on your profile, which will help you to stand out.
3. Why invest in us? - Your competitive advantage
Your competitive advantage is something that is exclusive to your company and not easily replicated. This value is created internally setting your company apart from your competition.
Competitive advantage = factors that allow a company to serve the market better than their competitors.
When sharing information about your competitive advantage, providing concrete examples, data, and evidence to support your claims is essential. By effectively communicating your unique strengths, you can demonstrate why your company is positioned for success and why investors should consider supporting your business.
Competitive advantage can be for example:
Innovation and technology
Market differentiation
Expertise and Experience
Strategic Partnerships
Scalability and Growth Potential
4. Share your KPIs - Demonstrate Traction
Investors want to see evidence of progress and validation of your business model. Choosing the right KPIs to highlight significant milestones, customer adoption rates, revenue growth, strategic partnerships, or successful pilot programs is essential.
Demonstrating traction shows that your business is gaining momentum and has the potential for success. Use data and metrics to support your claims and provide concrete evidence of your business's growth trajectory.
Here are a couple of examples of KPIs to choose to demonstrate your traction and progress as a startup:
Monthly Recurring Revenue (MRR): Measure the predictable revenue generated from monthly subscriptions or recurring services. It demonstrates the stability and growth of the business.
Customer Acquisition Cost (CAC): Calculate the cost of acquiring a new customer. It helps determine the efficiency of your marketing and sales efforts.
Churn Rate: Track the percentage of customers or subscribers who cancel or stop using your product or service over a given period. A lower churn rate indicates higher customer retention and satisfaction.
Monthly Active Users (MAU): Count the number of unique users who engage with your product or service within a specific month. It reflects the level of user adoption and engagement.
Conversion Rate: Measure the percentage of visitors or leads that convert into paying customers. It assesses the effectiveness of your sales and marketing funnel.
Average Revenue Per User (ARPU): Calculate the average revenue generated by each customer over a specific period. It helps assess the monetization potential of your user base.
Gross Margin: Determine the profitability of your products or services by calculating the difference between revenue and the direct costs associated with delivering them.
Burn Rate: Track how a startup consumes its cash reserves. It helps measure the runway or time until the company runs out of funds.
Return on Investment (ROI): Evaluate the financial return on an investment by comparing the gain or benefit to the cost of the investment. It showcases the efficiency of your capital allocation.
Viral Coefficient: Measure the rate at which your product or service is shared and referred by existing users to new users. It indicates the organic growth potential and viral nature of your offering.
Net Promoter Score (NPS): Survey customers to determine their likelihood of recommending your product or service to others. It measures customer satisfaction and loyalty.
Customer Lifetime Value (CLTV): Estimate the total value a customer will generate during their entire relationship with your company. It helps assess the long-term profitability of your customer base.