"Absolutely flawless" — When Shark Tank investor Daymond John revealed 5 key tips for perfecting a business pitch

A business pitch plays a significant role in securing investment, as emphasized by Shark Tank investor Daymond John in a YouTube video posted on November 4, 2020, on his official channel. He stated,

"Some of the pitches have been absolutely flawless and others, all the sharks go out before the person can even tell us their sales."

The effectiveness of a pitch depends not only on the idea itself but also on the person presenting it. In the video, the Shark Tank investor outlined five essential strategies to enhance a business pitch, covering aspects such as personality, financial understanding, proof of concept, audience awareness, and conciseness.

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Daymond John’s five key strategies for a successful business pitch on Shark Tank

1) Embracing personality in a business pitch

Daymond John emphasized that investors focus more on the entrepreneur than the idea, highlighting that personality plays a key role in securing investment. He further explained that different personalities can be effective in different ways.

"That person is witty, that person is funny, oh maybe that person is very detail-orientated… maybe there's somebody who lights up the room and makes you want to hear a story," he noted.

The Shark Tank investor stressed that, regardless of the style, conveying authenticity helps create a connection with investors and increases the likelihood of a positive response.

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2) Understanding and presenting financial data

Investors expect entrepreneurs to be familiar with their financial figures. John explained that investors do not always require exceptionally high sales numbers to show interest. Instead, demonstrating an understanding of financial data and being able to articulate key metrics effectively indicates business competence. He illustrated this point with an example:

"If you had an item that was a dollar or maybe three dollars… and you sold $50 worth in five minutes, I want you to close that bag because I want to take you around the world."

Additionally, John emphasized that investors assess whether an entrepreneur can effectively manage a business based on their financial knowledge. He explained that if an entrepreneur does not "know their numbers," investors may doubt their ability to operate the business efficiently.

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3) Establishing proof of concept

A business idea must be backed by evidence of demand, commonly referred to as proof of concept. John explained that this validation could take various forms, such as sales figures, online engagement, or customer feedback.

"Proof of concept is maybe you put out a video on YouTube and you got a thousand or five thousand views… or maybe you did a crowdfunding campaign and you hit your target within a small period of time," he noted.

He also shared an example from his own experience with early sales data. He initially started with ten different designs but noticed that only two were selling significantly more than the others. As a result, he decided to remove the remaining eight.

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4) Understanding the investor’s perspective

Knowing who is being pitched to and aligning the business proposal with their interests is another key factor. Daymond provided an example from Shark Tank, where he initially doubted investing in Bombas socks. He recalled,

"At first, I said to myself, I already got 10 clothing companies and eight of them are dead. Why do I need another clothing company?"

However, the founders highlighted their direct-to-consumer strategy and charitable business model, which ultimately convinced him to invest. He emphasized that successful entrepreneurs tailor their pitches to show how their business aligns with an investor’s expertise and priorities.

He explained that the founders of Bombas socks understood what would appeal to him, demonstrating that an effective pitch should communicate both the business opportunity and the value it provides to the investor.

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5) Keeping the pitch concise and clear

John also stressed the importance of delivering a pitch in a clear and direct manner. He advised,

"Be brief, be concise… tell a quick story, tell why it’s in it for the person who’s purchasing. A pitch that is too complex or lengthy can lead to investor disinterest."

He added that if a pitch is too complicated, it is not suitable for him and often not for many other investors. The Shark Tank investor highlighted that a well-structured and easily understandable pitch increases the chances of securing investment.

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Watch new deals unfold on Shark Tank every Friday at 8 pm ET on ABC, with full episodes streaming on Hulu.