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Differences In Marketing Messages When Targeting Clients Versus Investors?
Posted By: maxblumberg* on 6/28/2004 1:14 PM (CST) 250 Points
Morning all

I am doing a strategic marketing exercise with a client that provides consulting services and venture capital to IP owners.

In addition to client segments, I have been asked to create a position and value propositions for potential investors. My intention is to treat the investor group as just another market segment.

Does anyone have thoughts on marketing to investors? Might there exist a tension between marketing messages to client segments and the investor segment?

Thanks and best wishes

Max

Posted by: NuCoPro Accepted Answer
6/28/2004 2:40 PM (CST)
From current personal experience with a software startup, investors aren't just another market segment. I would say that maybe 75% of our "message" is universal, but the other 25% is totally different.

Customers want to know the details of your product/service and how it brings value to them. Investors want to know about such things as marketibility, barriers to entry and the management team.

My advice is develop collateral specifically for each audience. Even though a lot of it will be shared, minor parts of almost everything have to be tweaked to reflect the different tone, style and approach.
 
Posted by: kwinters* Accepted Answer
6/28/2004 2:46 PM (CST)
just like vevolution said above, the two different groups of people will be interested in two different things...Investors want to know that they will make money on their investment therefore they will interested in additional info...I would think that they would want to know the benefit profile of the products/services because they need to know that they are investing in a product/service that provides value and at the same time, they will want to know managemet history, competitive strategy, distribution strategy, promotional strategy, pro forma financials, profiles of competition and the market, etc.
hope this helps...
 
Posted by: maxblumberg* Author Response
6/28/2004 2:50 PM (CST)
Thanks for that. I definitely intend to develop separate messages for each segment as the segments needs all differ significantly. I guess what I am asking is how others perceive typical investor needs of which you have provided a useful three.

I will also intend to include a) ease of exit for investors, b) life-time value of the customer base, and c) strength of the management team as I believe that these are key investor needs.

Best wishes

Max
 
Posted by: NuCoPro Member Response
6/28/2004 3:04 PM (CST)
It seems you really need a comprehensive business plan with financial projections. I thought your client was helping others raise capital, but it sounds like they are trying to raise funding for themselves.
 
Posted by: maxblumberg* Author Response
6/28/2004 3:11 PM (CST)
Sorry, yes let me clarify that they are also looking to raise capital for themselves. There is a strong business plan in place. One of my tasks is position that plan and articulate its value propositions to potential investors.

Best wishes

Max
 
Posted by: thinkmor Member Response
6/29/2004 5:53 AM (CST)
lXd uÁgree with the above, you may have already thought about it but Confidentiality is key for investors. Some prefer to remain anonymous.

A track record is always useful to case study with endorsements.

Marketing to investors is usually, as you know, more personal direct selling so relationships, buiding trust, chemistry become extremely important.

Also, an NDA is also useful to protect yourselves against unnecessary disclosure.

Hope that helps

Have a great week

Thinkmor™

zahid@thinkmor.com
 
Posted by: NuCoPro Member Response
6/29/2004 8:52 AM (CST)
Since I'm currently living in the startup/fund raising situation myself, I hope you will accept the following.

1. Business Plans do NOT attract investors. However, you need to have a good one for AFTER you've got the investor interested. I have probably talked with 150 - 200 people so far; only 2 of them have read the entire Business Plan.

2. The prinicipals of this company are the ones who have to "sell" this to investors, not you. Investors must believe in the management team before they will even consider looking at the idea. They pick the jockey, then check out his horse.

3. The only thing you MAY be able to do is help "tee up" some investors for the principals to meet with. However, the investor may perceive it as a negative that they weren't initially contacted by a principal.
 
Posted by: Jim Deveau/Catalyst* Accepted Answer
6/29/2004 1:58 PM (CST)
Hi Max:

Great advice from my colleages above. I would add the following fundamental requirements for a business investor presentation:

1. What is your profit model? In a very clear paragraph - be able to state HOW YOU WILL MAKE MONEY. This sounds ridiculously simple, but far too many proposals try to impress investors with the slickness of a product/service and forget the fundamentals.

2. What needs do you fulfill and how much is this worth to the target audience?

3. How will you differentiate - but most importantly - how will you PREVAIL and WIN over your competitors? IF I am going to invest in you - I want to WIN - and I want to know what you have up your sleeve that will help insure I WIN.

4. How long do you plan on burning through funds until I start to see a return? What steps have to taken to ensure that working dollars are channeled into RESULTS and RETURNS as quickly as possible? NOTE: This section is OFTEN in conflict on what it takes for a proper business model to succeed - it will take a LOT of thought and positioning.

5. Why is your team worth the risk (covered admirably by vevolution above)?

I hope this helps.
 


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