When will the right time come for you to pitch your big idea to that big investor? If you are waiting for it to just happen, out of a random or chance meeting, then go and buy a lottery ticket. If you think that is the only way you will get a shot, you are mistaken.

Think about it from an investor’s point of view. They have a responsibility to invest the money that they are entrusted with wisely. Did you catch that? They have a responsibility to invest; it is their job to give money to people or organizations with great ideas. This bodes well for you getting an opportunity to pitch your idea.

All you have to do is get through the filters. Investors do not have time to entertain every single person with a crazy idea who wants to ask them for money. That is where filters come into play. Investors setup a series of filters to weed out poor investments from those that show greater potential. Most investors use a combination of filters; the bigger the investor the more filters you will run into. A word to the wise, do not try to undermine the filters; they are in place for good reasons. If you try to skip through, you will not get through. Instead work your way through the filters; remember the investor has a responsibility to invest their money.

Here is a list of some of the types of filters you may run into:

1. Door Keepers: Most investors have various levels of assistants who handle their communication and act as door keepers. Another way to think of this is that the assistant acts as a second party on behalf of the investor. You can not pick up the phone and call a big investor directly to pitch your idea.

2. Spotters: Some investors use spotters who keep an eye out for good investments. These spotters will invite people to present their idea to the investor, if the investment is a good fit. Spotters often keep a low profile and do not promote their real purpose. If they like you and your idea, they will make the first move. Record companies use this strategy all the time. Think about any band and there is always a story about how they were “discovered”. Sometimes close friends of the investor play this role unofficially and there is no formal spotter filter.

3. Requirements: Investors will set out requirements for their investments. The most common requirement is that the investment is in a specific area (i.e. real estate, telecommunications, or the internet). This filter is almost always present in one form or another and is usually tied closely to the investor’s background.

4. Unknown: Investors are generally unknown. It takes a bit of research to find them, or you have to know someone. They are not in hiding, but again they do not need every Joe calling them and asking for money.

Here are some tips to help you navigate the filters:

• Do not try to get around investment filters.
• If you use your detective skills to get around a door keeper by finding the investors home phone number you will be rejected.
• You must build your relationship with door keepers and be introduced to the investor.
• If you are an established or establishing organization, an invitation to tour your operation can open many doors.
• Do not underestimate a round of golf. If you get the opportunity to play with the investor or door keeper give your elevator pitch. Do not go into too many details; leave them wanting, and intrigued.
• Make sure you have a good match. If the investor only invests in real estate and you do not have a real estate investment, then you probably should not bother.
• Talk to someone who your potential investor has already invested with.
• Get their business card. As Shane said on his blog, “the real purpose of your card is not so that the person you meet will call you. The purpose of a business card is so that you can lead the exchange to get their card, so that you can call them.”
• Don’t ask for money without being prepared to give something in return, namely a percentage of ownership in your business.
• Be prepared to pitch at any moment. If you have a meeting with an investor or a door keeper they will keep you on your toes. They want to see how you react under pressure. Further, they may introduce you to someone you did not expect, who may be another potential investor.

You can make the opportunity for yourself to pitch your idea to potential investors. Again, they want to invest the money they are responsible for. They will protect themselves, with investment filters. But if your idea provides a reasonable return on investment, you will navigate the investment filters, and gain the opportunity to pitch your idea.

This entry was posted on Wednesday, September 26th, 2007 at 4:26 am and is filed under General Innovation, Innovation Tools. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.