Deck 11: Pitching the Venture to Investors

Question 1

A well-written executive summary, or "teaser" gains the attention of the targeted audience.

Answer 1

False

Question 2

An executive summary document should be given with a short personal cover letter.

Answer 2

True

Question 3

An elevator pitch should be a lengthy pitch to an investor that details every aspect of your business.

Answer 3

False

Question 4

The verbal equivalent of the teaser is called an elevator pitch.

Question 5

It is recommended to hand out a copy of your PowerPoint when giving a presentation to potential investors.

Question 6

Fortunately, most investors read business plans in detail.

Question 7

In preparing a teaser, you should avoid using words such as "should, might, could, etc."

Question 8

When presenting, it is recommended to use catchy words such as "revolutionary, cutting edge, and best-of breed."

Question 9

Personal chemistry does not affect how investors see your business plan.

Question 10

Fewer slides are better than too many.

Question 11

Every communication should be tailored to fit the targeted audience.

Question 12

__________ refers to the terms and timing of the deal.

Question 13

__________ is the stock, cash, or debt that will complete the transaction.

Question 14

The final financing agreement that includes ownership, control, and financial objectives is called a ____________.

Question 15

Another alternative to finding active investors is to pursue _____, or arm's-length, investors, who will have little or no involvement in the business.

Question 16

A(n)_________ is a teaser or document short, clear compelling document that must be impeccable in its appearance.

Question 17

Letting an independent third party review an invention and comment on its status, viability and originality is called ____________.

Question 18

____________ should be at the end of your PowerPoint to cover more detail to address anticipated questions.

Question 19

Entrepreneurs should use a(n) __________ rather than a "shotgun" strategy for engaging in potential investors.

Question 20

Good ____________ is vital throughout the life of the investor-company relationship.

Question 21

If a small business loan is sought, there are probably several local _______ that may participate in federal lending programs to support small companies.

Question 22

Angel investment can best be found by:

A) Networking within your local business community.
B) Asking for referrals from your accountant and attorney.
C) Talking to other companies in your region that have received angel investors.
D) All of the above.

Question 23

Which of the following is NOT an appropriate way to identify a Venture Capitalist?

A) Searching the Internet for VC firms that have invested in companies like yours
B) Talking to law firms that specialize in patents and early stage company formation
C) Looking through the phonebook
D) Talking to companies like yours that have received investments from VCs

Question 24

A teaser is typically:

A) A short written document.
B) A long written document.
C) A short verbal pitch.
D) A long verbal pitch.

Question 25

An elevator pitch is typically:

A) Less than 2 minutes long, highly targeted, and prepared.
B) Unrehearsed and spontaneous.
C) Longer than five minutes.
D) The length of an elevator ride.

Question 26

When making an investors' presentation you should:

A) Use 10-16 Slides.
B) Read the content carefully to the audience.
C) Have at least four persons present the information.
D) Not tell them your name.

Question 27

An investors' presentation must cover the following topics:

A) Your personal financial status.
B) The size of the market.
C) Detailed 10-year financial predictions.
D) The résumés of the people you intend to bring on board.

Question 28

How are back-up slides used in an investors' presentation?

A) address pertinent detailed questions
B) Never used in a presentation
C) To fill in time if you finish early
D) To disarm difficult questions

Question 29

You should follow these guidelines when making a presentation:

A) Do not over rehearse as you will lose your spontaneity.
B) Keep to the script and avoid interruptions.
C) Listen carefully to the audience.
D) Avoid small talk before the formal presentation.

Question 30

Why is it a bad idea to hand out copies of your presentation?

A) They will look ahead and may engage in side conversations
B) It is a waste of paper
C) You are suggesting your investors have poor eye sight
D) It is a good idea to hand out copies of your presentation

Question 31

When wrapping up your presentation, you should:

A) Refuse to answer any questions.
B) Leave as quickly as possible.
C) Finish on an up note.
D) Give candy to the investor as a gesture of goodwill.

Question 32

After you have made an investors' presentation you should NOT:

A) Look too eager by following up within 1-2 days on any outstanding factual issues.
B) Wait for a month before calling them.
C) Call them after a few days.
D) Set up another date for a follow up meeting.

Question 33

If a potential investor indicates that they are not interested in investing in your company you should NOT:

A) Ask for the reasons.
B) Suggest that you stay in contact.
C) Ask for referrals to other investors.
D) Bad-mouth them to other investors.

Question 34

The preliminary financial summary portion of the presentation could include all of the following except:

A) Forecasted revenues, expenses and gross profit.
B) Forecasted hours of operation.
C) Forecasted EBIT margin.
D) Forecasted direct labor costs.

Question 35

After making three presentations to the partners of a VC firm, you are asked to submit a detailed business plan. The firm will not sign a confidentiality agreement. You:

A) Decline to submit the plan.
B) Modify the plan to take out the highly confidential items.
C) Submit the plan with all the confidential information.
D) Accuse them of trying to steal your business plan.

Question 36

It is usually possible to remove how much text between the first and the final version of the teaser?

A) 2-4 percent
B) 10-15 percent
C) 30-50 percent
D) 85-95 percent

Question 37

When presenting to an audience, you should:

A) Be enthusiastic.
B) Overact.
C) Primarily focus on the nonverbal behavior.
D) Be abrupt.

Question 38

Which of the following should you NOT do when presenting to an audience?

A) Use no more than two speakers
B) Face the audience
C) Read from the slides
D) Use less than 16 slides

Question 39

If investors have expressed any degree of interest, the entrepreneur should:

A) Move into action.
B) Wait a few days to build anticipation.
C) Never call back, wait for investors to move on the opportunity.
D) Force them to invest immediately.

Question 40

Which of the following is NOT a fundamental section of the evaluation period?

A) The Deal
B) Context
C) Investment
D) Business Model

Question 41

The term sheet is between:

A) The company and the investor.
B) The shareholders and the company.
C) The issuer and the investor.
D) The issuer and the shareholders.

Question 42

In preparation for making a presentation to investors, you should:

A) Present in front of several people.
B) Ask investors if you can do a trial presentation to them.
C) Send each investor a videotaped version of your presentation.
D) Act and not prepare.

Question 43

Context refers to:

A) The detail of your presentation.
B) The intelligence level of your management team.
C) The market size of the potential company.
D) Internal and external factors that affect the business.

Question 44

Which of the following is NOT a proper way to locate an appropriate investor?

A) Look within the industry
B) Use the internet
C) Speak with other entrepreneurs
D) Advertise in the newspaper

Question 45

Which is NOT a category that a VC firm focuses on?

A) Location
B) Stage of Fund
C) Employee potential
D) Stage of Company

Question 46

Which of the following is true about promotional videos:

A) Promotional videos should not exceed 10-20 minutes in length.
B) Promotional videos are good options for raising start-up funds via crowdfunding.
C) Although high-end audio video equipment is required, promotional videos can engage potential investors and stakeholders.
D) All of the above are true.

Question 47

Components of a presentation include all of the following, except:

A) Funding requirements.
B) Exit strategy.
C) Confidentiality agreement.
D) Operating summary.