Last week, my friend Ben tweeted a great presentation (see below) from Brendan Baker on improving your startup pitch. Doing a great pitch is incredibly hard. It is even harder these days when you have to do it (mostly) over video conferencing.
Be ready. We've got one shot.
Raising money is probably around 30%+ of the job of a startup founder who is playing the 'venture capital game.' While great timing is one element to do so successfully (see my post on this here), you also NEED to craft a captivating pitch before going out there. Investors see so many companies. Let's not waste your opportunity because of a bad pitch.
1) Tell a story. Write a script that captivates your audience.
Telling a great story is your most powerful asset to build and lead fast-growing tech companies. In the early days of a startup, you have a small passionate team, an initial product out in the market, and a view of how a specific market's future should look. That's it... Many founders get there, but very few can take it to the next level. Very often, they miss a great story to captivate investors.
You need to have a script that flows, connects all your ingredients, and makes investors connect with your vision.
There are many ways to tell a good story. One way to do so is to use analogies. While very efficient, it can be tricky. Here a post I wrote some time ago on this. Brendan also uses a great analogy to explain why pitch scripts are often not very exciting.
To pitch an excellent bread (company), do not just list a bunch of slides with ingredients (market, product, team, vision, etc.). This is not bread on the picture. Instead, build a script of story arcs illustrating why the company's product is unique and will be loved by many people. For each topic you would like to cover, build a captivating story arc. This allows you to keep your audience engaged all the way through your pitch while having captivating answers when challenged by investors.
2) Think at the investor's level. Explain the 'Why Now'.
Entrepreneurs are execution machines. Investors are not. Most entrepreneurs can step up one level to talk about their vision and mission. This is essential for hiring, PR, etc. However, investors do not live at this level either. You need to go one step further. They are thinking about how the world is changing, about big trends, and which teams and products can jump on this train wagon to grow exponentially in the coming years.
Why is now the best time for your company to be built? Why by your team? To answer this question, you need to make sure that your story is time relevant. In this post, I explain, for example, what investors are looking for in the current COVID climate. So, if you are going out now, make sure to articulate how your business sees or will see an increased demand soon on what's happening NOW. Brendan refers to Zynga's example, using Facebook as a unique distribution channel, in the late 2000s.
3) A pitch is not rational.
Your first mission is to get investors excited and drive the desire for more. Once you successfully pitched an investor, and only then, the rationality and number crunching will kick in. Think about this. We are looking at a bit more than 2500 pitches a year. Many are strong, but only very few get us excited. I mean, if you can't get us excited, how could you get the entire world excited about your product?
My advice is simple. Write a script, practice, practice, practice... One way to do so well is to record yourself or pitch friends and list the points that create 'Excitement' and 'Hesitation'. Double down on the exciting points. And, do so early on in your deck.
4) Do not try to be credible.
You are an entrepreneur. This gives you enough credibility. Great investors know how hard it is to be an entrepreneur and how brilliant you are to be able to build a business from scratch. Don't lose time on flooding your deck with irrelevant numbers and facts.
Instead, insist on why you are different, unique. Why are you an exceptional entrepreneur? Why are you the best woman or man for this job? What is your unique insight?
5) Cut the shit.
Do not try to include everything. But focus on your story, strengths, and essential insights. The more you add to your pitch, the weaker it gets. You risk losing your audience... Here some elements you should consider to cover in your story arcs: Problem, Vision, Solution, Team, Why now, Market Size, Traction metrics, Key customers, Milestones and Projections, Competition, How much you would like to fundraise and why. I caution against suggesting a valuation of the company in the pitch deck. Leave this for later. Your mission is to get investors excited, not negotiate with them. These elements are of course different for each pitch. Always build a pitch on YOUR STORY first. If you get the investors excited, I can assure you that they will ask for the rest.
Finally, I recommend founders to create a slide deck. It allows you to better control the conversation and craft the best narrative for your company. Sometimes you will use it when talking or reaching out to investors, but not always. Most importantly, it will be used when you are not in the room: within VC firms to share with other colleagues, write investment memos, etc. Don't give up that control.
When I arrived at my office yesterday, I found this note with a great Italian wine on my desk. It is from colleague Matteo who finished his summer internship last Friday. Thanks for spending time with us Matteo, I wish you all the best for your next steps. And, yes, I couldn't agree more with you: Life is awesome.
Have a great week,