Young, up & coming hustlers tend to work quite hard to nail down meetings with investors. It usually takes a combination of good targeting, persistence and finding a way in. An investor highlights the 5 most common oversights that can turn your meeting with investors into a nightmare…

Shark Tank SharksThe good news is that each of them is not only completely avoidable but, if addressed properly, can lead to fruitful discussions with potential investors.

1. Not knowing your audience

Many first-time entrepreneurs tend to get so excited to speak with investors that they forget to do a little homework to understand who they are meeting with and how a particular investor may be a good fit for their start-up. This is setting an entrepreneur up for failure. It’s critical to understand the profile of the investor you’re speaking with: What stage do they typically invest in? Have they made any investments in your sector? Is there a particular reason that they should be excited by what you’re doing?

It’s easy to check an investor’s profile on LinkedIn or AngelList to get a good sense of whether there’s the potential for a good match.

2. Depending too much on your company profile

Sometimes, entrepreneurs place too much emphasis on preparing a terrific deck (company profile) that tells their story and then are thrown for a loop when investors resort to having a conversation. While you should always have a deck on hand for a meeting, take the opportunity to own the conversation and listen to what an investor’s hot buttons or concerns might be. Always start with the elevator pitch, why your team is the one to execute the vision and why this particular investor should be involved. Decks typically work best if there are many people in the room, since they provide a structure to communicate. Otherwise, use your deck as a tool to re-inforce the conversation by sharing it as a follow-up to your meeting to help set the stage for the next conversation.

3. Stating there is no competition

This is a faux pas that prompts investors to think you may not be aware of what you’re up against. Competition exists everywhere and is not bound by geography or what you only see with the naked eye. The competitive landscape can be made up of existing companies or new start-ups that are being hatched in a lab somewhere. Even the most disruptive start-ups compete for dollars or mindshare that is currently being directed elsewhere. You should understand the alternatives your customer has for your product or service and be able to articulate why they are better off changing their behavior.

4. Having no data to back up your assumptions

Regardless of the industry in which you compete, you need customers to build a business and over the long-term, you need to demonstrate a path to profitability. Whether your customers are individual consumers or businesses, it will cost you to have them try your product as well as keep them coming back.

There are a variety of metrics that apply to all businesses that relate to this, including: customer acquisition cost (CAC), churn and lifetime value (LTV). These are basic principles which form the underlying framework for your revenue model. Make sure you know them inside and out.

If your start-up is too early in its formation with very limited history, establish assumptions that can be supported based on what others in the industry are doing.

5. Forgetting the follow-up step

Whether your initial meeting with an investor has gone well or not, you should not leave without an understanding of what the next steps should be. Many times, entrepreneurs are a bit hesitant to get direct feedback, with the fear that they might not like what they are about to hear. If the meeting has gone well, you can ask the investor what other information they need and what they see as a reasonable next step for their evaluation. If the meeting has gone south and it’s clear that the fit in not right, ask the investor for suggestions of other investors where the fit might be better. Also, it’s good practice to be thankful for their time and ask if they are fine with you including them on future business updates. It never hurts to stay top of mind.

Story by Arie Abecassis, Tech Entrepreneur and Investor