What are Pitch books and How Can Fintalent’s Pitch Books Consultants Help You
Pitch books in finance is an industry term for a compendium of information about a stock or company, usually prepared by investment bankers with the intent to raise capital. Pitch books are used to provide potential investors with all relevant information about the company in question in order to help them make an informed decision regarding whether or not they wish to invest.
A “pitch book” is a detailed written proposal that includes all of your company’s financial information, plus projections and budgets. They also include any other pertinent information that you feel will help attract investors. The typical size can range anywhere from 50-100 pages, but typical companies usually only use the front section to gain potential investor interest. There are many benefits to pitching your company in this way; it can be an effective tool for getting startup capital, landing good clients or networks for referral purposes, and even securing funding from venture capitalists Crowdfunding websites like Kickstarter offer another way to raise capital for your project which typically utilizes smaller investment increments than venture capitalism. However, most investors want to know all the details. Pitch Books are a helpful tool for presenting your business in a professional manner with supporting documentation. In most cases, they can also be a selling point for potential investors during an initial meeting.
Investment bankers typically produce pitch books either for private companies looking to go public via an IPO, or for companies that are being acquired by another company. The goal of the book is always the same: Convince investors that the company is worth investing in.
In addition to providing all relevant information regarding the company being pitched to investors, a pitch book will often contain details regarding the company’s past performance. In order to help investors be confident that the performance in question was not a one-off occurrence, a pitch book will typically include a number of years in which a particular level of performance was reached.
Pitch books provide investors with an opportunity to examine whether or not they wish to invest in a particular company or stock before deciding whether or not to buy shares for themselves. In order to make their decision easier, potential investors will often ask an investment banker if they can see copies of past pitch books for the company in question.
While different investment banks have different terminology for pitch books, there are some common ones that are used throughout the industry. An executive summary is a section of a pitch book that provides summaries of crucial information about the company being pitched. The executive summary is typically brief, with the idea being to easily capture an investor’s attention long enough for them to be interested in reading more.
Types of Pitch Books
The two most common types of pitch Books companies use are:
Financials – These describes all of your company’s financial information including revenue, costs and expenses based on the projected time frame of the report’s writing and publishing date. This section will include: Revenue reports Sales and marketing budgets Operating budgets Other pertinent financial information. Financial projections – These do not necessarily have to include revenue numbers but they must be significant enough to indicate the accuracy of your projections and provide credibility for potential investors. This section will include: Revenue projections Cost projections BUDGET/PROJECTION SUMMARY
Pre-Pitch – In order to get the investor’s attention, you will need to get your pitch book ready for a possible investor meeting. This is an informal meeting where you can present your company and pitch your product. If the investor is intrigued, they’ll ask you to come back with a full-fledged pitch to a formal meeting. You should also use this time to get comfortable with pitching to a group of investors. If a group of investors are interested in working together to invest in your company, you may want contact them directly via email or other message service such as Skype for further discussion and frequent meetings.
What do Pitch Books Contain?
The pitch book contains much more than just basic financial information from the company being pitched. In fact, because these books are so important for investment decisions, the pitch book will cover much more than just the financials.
Pitch books contain information that provides an investor with an overview of a company’s product, technology, management team, industry trends, past performance and future opportunities. Put simply they are “value pack” presentations of a company that generally include most of the relevant information you could need to make an informed investment decision.
The pitch book is designed to provide an investor with all the information needed for them to make their own informed decision on whether they want to invest in this specific company or not. It will provide investors with information such as:
The pitch book may contain a few or many pages if the company is under many different industry segments. For instance, an American chip company may have a pitch book that contains information for investors based in Europe and China. A Japanese TV maker may have a pitch book that focuses on Japanese investors and the Japanese market, and so on. It is important to remember that if you are pitching to someone in Japan it is your job to tailor your pitch so it does not lose its appeal for the intended audience.
Pitch Books: The Good and Bad Pitches
It can be difficult to tell which kind of pitch has been presented well and which one has been poorly done. If you are an investor, make sure you ask for a pitch book to review before deciding to invest in a company.
The “Good Pitch”
A good pitch generally will contain the following:
- A clear description of what the company does and who they are. This ensures that the listener gains an understanding of the business model. Some pitches may have too much information but they should at least have some information here so that it is clear what company is being pitched to them.
- It should describe why the business model works. This is important so that investors know what kind of opportunity they are getting involved with and whether or not this opportunity will be profitable in the future. If the pitch does not properly describe this model, investors may not be willing to invest in it.
- A pitch book should include information on the market. If the pitch product is unique in an industry, it should be described how it works and what advantages this product has over other products on the market. This will give investors a clear idea of why they want to own the company they are considering investing in.
- A pitch book should provide information about recent performance of company against competitors. This gives investors a realistic picture of what kind of performance both short-term and long-term this company can offer them if they decide to invest in it.
- The pitch should also include information about the competition in the industry. This kind of information gives investors an idea of how the company they are considering investing in will perform compared to its competitors, and whether it can succeed in this competitive environment.
- The pitch should explain risks involved with the investment. It is important that investors understand what kinds of risks could happen if they decide to invest in a particular company. They may not be willing to take this risk because there could be negative consequences if they decide to invest, so it is important that these possible risks are clearly explained here.
- The pitch book should include financial forecasts for future years. This provides investors with information about how the company will perform in the future. This is usually where investors decide whether or not to invest in the company, so it is important that this section of the pitch book is carefully written and makes an accurate forecast for what kind of earnings potential this company has.
- The pitch book should also include financial statements (balance sheet, income statement, etc.) for past years. These show past performance and give an idea about how well this business has performed in the past. It should also include financial projections for future years. Again, these should be at least close to reality if investors are going to be willing to invest in the company.
- The pitch book should include an overview of the management team, and information about how this management team is going to operate the business in the future. This would give investors a clear idea about what kind of leadership they will be getting with this company and who will make decisions in the future. It is important that they know who they are investing in, so knowing these details will help them decide whether or not it is worth investing in this business.
- The pitch book should contain information about what kind of technology their company uses. This is important because it shows how well that company is focusing on what makes their product different or unique when compared to other products on the market (i.e. the product itself).
- The pitch should contain information about the company’s financial position. This is important so investors know how much debt this company has and what kind of financial risk they are getting involved with if they decide to invest in a business.
- Information about patents should be included, because this shows how unique the product is and gives investors an idea of how hard it will be for competition to copy the product. It also ensures that if an investor invests in this business, they will get something valuable in return (like a patent) for their investment.
- Finally, the pitch book should include an overview of the industry that company is operating in. This should give investors an idea of how this business operates within its industry and how it compares to other companies operating in this industry.
The “Bad Pitch”
The “Bad Pitch” is one where the majority of the information about the business model, market, competition, sales, and financial statements are missing. This is usually because the pitch book was not drafted properly or it contains information that is outdated or incorrect. Investors should ask for a round table meeting with the company to review the pitch book before they decide whether or not to invest in it. At this meeting, they will be able to ask questions about the information in the pitch book. They will also be able to see how the business operates and how well it is run so they know exactly what kind of investment they are getting involved with.
Another reason why companies do not succeed in their pitches is because they do not know their company inside and out. They think that just by having a nice presentation, investors will invest in their company without really knowing what it does or who makes decisions about the company. Investors need to know that the management team is well-educated and that they have enough experience. If this is not the case, then investors should not invest in the company. They should take time to review everything about the company including records, reports, etc. before deciding whether or not they want to invest in it.
The “Bad Pitch” has little direction and lacks strategies to ensure success of the company (i.e., sales strategies, marketing strategies). Investors may not want to invest money into a business that does not have any goals or plans for growth. This is especially true when investors are looking to invest in a business that has already made money. They should look for businesses that have plans to grow its revenue and continue making profits in the future, not just stick with the business model that is already working. Examples of good growth strategies are detailed below:
- The company should have goals for growth. A goals plan illustrates what the management team wants to accomplish with this company in the future. This kind of growth plan shows investors that this business has a clear directional plan to where they want to grow their company and how they will get there. It also shows investors that they can depend on this vision and trust their leaders to be able to make good selections based on their vision for growth.
- The company should have a clear marketing plan. A marketing plan is a detailed outline of how marketing will be carried out for this business in the future, including how many new customers they will try to acquire each month. This plan should include the budget allocated towards advertising, advertising copy style, etc. This gives investors an idea of how much money the business is investing in different marketing strategies and what types of strategies are being adopted.
- The company should have established sales strategies that have been proven successful in the past. Investors should look for companies that have already invested money into selling their products and services and then followed through with those strategies to acquire new customers and make profits by selling these products and services.
- The company should have established processes in place to generate profit. Being able to generate profit will allow the business to continue making profit after paying its operating expenses, which will make it easier for them to achieve their goals in the future. A company that does not generate profits is likely to go out of business if they do not earn enough money to pay their debt and expenses.
- The company should have a detailed strategy in place on how they are going to grow their revenues over time after investments are made. This is important because it shows investors that this company has a clear plan for growth and how they are going to achieve this plan. This makes investing in a business a lot easier for investors because it shows that the business has a clear plan. If a business does not have a growth strategy, then they have no way of making money in the future, so it is important that they have something in place to ensure they continue making profits until their strategies are effective.
- The pitch should include financial statements including cash flow statements. This will show investors how much money this company is making on an annual basis and what kind of revenue this company has on hand at any given time. These financial statements will show investors where the money is being spent and on what expenses are being paid. An investor should have a clear idea of their financial situation because this can give them an idea of how much money is being spent on operating expenses and debt. It will also show investors how much money they have in the bank to take care of their debt obligations.
- The pitch should include a growth strategy that includes milestones that the company will work towards in order to reach goals for growth. An investor should look for a business that has a detailed growth strategy, which gives them an idea where their company is going and what needs to be done in the future to make sure they reach these goals. The more detailed this strategy is, the better it will be for investors to understand how their company plans to grow over time.
- The pitch should include a plan that includes strategic alliances that the business intends to form with other successful companies. A company that plans to form alliances with other businesses in order to expand their product or service offerings usually makes great partnerships because they provide their partner with new ideas and opportunities for growth. These strategic alliances can help businesses reach new markets, since they will allow them to reach customers in areas they were unfamiliar with before these strategic alliances were formed. Partnerships that are not very successful usually fail to materialize because they fail to provide a clear direction for growth that shows investors how this strategy could work out well for them. Once a business has a clear growth strategy and a clearly defined plan, investors will have a better sense of what their future plans could be and will be more likely to invest in them.
- The pitch should include details on the projected gross margin for the company over the coming months. This is important because it shows investors how much money they can expect from this company each month as well as if there is room for cost savings to be taken from each business unit as well as from other areas within the company to lower expenses. Investors will also appreciate an estimate of expenses for this year and how much money they expect to make in the next few months. If this is not outlined then investors will not know what they can expect in terms of revenues and profits.
- The pitch should include details on the projected net profit margins, which is the difference between revenue and expenses. This shows investors how much money they can expect from this company each month as well as if there is room for cost savings to be taken from each business unit as well as from other areas within the company to lower expenses. Investors will also appreciate an estimate of expenses for this year and how much money they expect to make in the next few months.
- The pitch should include details on the projected sales and expenses for this year, which helps investors get a sense of how much money is being spent on operating expenses and debt. If a company cannot generate enough revenue to cover their operating expenses then they will not be able to continue operating in the long term. Investors need to see where exactly their business is spending their money, which will allow them to get a better idea of whether or not they are making money from their operations. These numbers can help them plan out how much money they will be able to make over the next year if revenues fall within the projected range.
Just like a traditional financial statement, the pitch book contains information that could be useful when making an investment decision. In fact, after all, it is called a ‘pitch’ because people use this information in their pitch to investors to solicit money for a particular investment. They have been referred to as the “bible” in some cases because they contain so much information and could be used as a reference for investors. the pitch Book could be a company’s most important bit of information that reaches investors even before they have an opportunity to interface with the business’ owners. It is therefore imperative that the pitch book is properly prepared by a suitable Pitch Book Consultant. this is exactly what Fintalent offers with its array of expert Peach book consultants.