3 Keys to Successfully Pitch an Impact Investor
Social impact investors and incubators are a growing arm of the social sector and an increasingly important funding option for small organizations looking to scale. “What we’re hoping to do is have a world where the best nonprofits, the most successful programs, have a pathway to access the kind of growth capital that we see in the private sector,” said Tracy Palandjian of Social Finance.
Like Social Finance, the PVBLIC Foundation is working to bring transformative funding to great social solutions. But to reach these impact investors and convince them to support your organization or program, you need to be able to pitch to leaders like Sergio Fernández de Córdova, the co-founder and chairman of the PVBLIC Foundation.
To help you pitch and partner with impact investors, we spoke with Fernández de Córdova about what he looks for in applicants. The three big takeaways below will help you show investors why your ideas are worth developing.
1. Tell Your Story
Just as it’s critical in your donation appeals, storytelling is one of the most important parts of pitching investors. But to get funders to invest in your work, you have to tell a different kind of story—your story.
“Why are you doing this? Tell me about you. When I sit down in these meetings the first thing I say is, ‘Close the deck, tell me who you are. Tell me about you. What brought you to this journey?’
No matter how good your idea is, investors want to know the person who will be driving this project forward. Think of it this way: if you were handing over a $250,000 check, wouldn’t you want to know who will be using it? When you show investors why you are passionate about this cause, it helps them see your commitment to stick with the mission and solve the problem.
And Fernández de Córdova doesn’t just want to know you care, he wants to see that you’ve put in the work. He said that he likes when applicants have already devoted their own time or resources to the problem. “[If] you don’t have dirt under your fingernails, then how am I supposed to believe you?” he said. Your pitch to impact investors should show how and why this cause became so important to you and prove that you are already devoted to the solutions you are presenting.
2. Do Your Homework
Pitching your world-changing solution to impact investors is like interviewing for your dream job: passion is essential, but so is know-how. “It’s fascinating how many people really haven’t done their homework,” said Fernández de Córdova.
Many social problems are extremely complex and influenced by a number of stakeholders and environmental conditions. These are not the kinds of problems you luck into solving. This is why it is so important for social entrepreneurs to research and educate themselves on the issues involved.
For example, if you want to improve graduation rates in your city with new curriculums and teacher training, your knowledge can’t be limited to the classroom. You need to know who the students in your city are, what demographic or geographical groups are underperforming, and why. If students are constantly missing school, a curriculum change probably won’t be enough to solve the problem. What social and economic conditions contribute to low attendance rates?
No matter your mission, in order to convince impact investors that you can affect change, you need to dig deep into your problem.
3. Show What Makes You Different
Part of the importance of knowing the history and background of your cause is to see what approaches have failed and avoid repeating those missteps. Therefore, you need to show how your solution brings something new to the table in order to convince investors to back your work . Investors wouldn’t give you money to create a product that already exists, so why would they fund a solution that has already been tried?
When explaining your work to impact investors, emphasize how your solutions approach the problem in a new way or incorporate different resources, stakeholders, and opportunities. As you present your project or program, highlight what you will do differently and how that will lead to better outcomes. The greatest products, programs, and ideas succeed by taking what has worked in the past and and adding elements to solve for its limitations.
Impact investing may seem like a new frontier to social impact, but the steps to successfully pitch funders are not so different from your other marketing efforts. If you can convey your passion, expertise, and creativity, you can unlock new sources of capital and support.
Join us at the Collaborative to learn from experts in impact investment and fundraising.