Unless you learned public speaking and creating investor presentations, this article will give you some basics about building pitches.
Dave McClure is one of the best and most popular angel investors in the world. Many startups only dream about presenting him their idea. Most of them will not have this chance.
7/ we are NOT ur mom, we are NOT bankers, we are VENTURE CAPITALISTS -- greedy, blood-sucking, motherfuckin' Gordon Gekko CAPITALISTS.— Dave McClure (@davemcclure) 11 marca 2015
There’s obviously many reasons, but let’s start with one of the most common ones - many young entrepreneurs don’t have the skills to present in an attractive and efficient way.
I know from my public speaking consultancy experience that many people think that they are good presenters. Well… too often they are wrong. Everyone has done that in school, but the problem is that nobody taught us that (at least in Poland). So unless you learned public speaking and creating investor presentations, this article will give you some basics about building pitches.
Without further ado, let’s see what you can do to completely ruin your pitch.
1. Don’t prepare yourself.
Why would you?
“I create this project, so I know everything about it”.
Well, yes, but when the investor gives you just one minute, what will you include? What about two minutes? And what would you say in five?
There’s many pieces of information you have to think through. Some of them you’ll find further in this article, but preparation is not only deciding on the content of your speech. You have to take technical aspects into consideration and the slides are just the tip of the iceberg. Tone of voice, use of pauses, pace, eliminating “umms” and many more. It’s good to practice your pitch in front of a mirror, cofounders or friends. You can also consider hiring a professional - a public speaking consultant who will help you prepare the pitch.
2. Don’t catch listener’s attention.
Or in other words - be boring.
There’s many pitch templates out there that you can use with success. There’s also plenty of ways to be unique and still share all the same information even when using these templates. Just like David Arnoux presenting Twoodo in this video:
Pay attention to how nicely he glues all the elements together. But you know what makes him different from most of pitching founders? He could have said that they are creating a platform that integrates a couple of tools which will make work easier. Period. Instead he starts with a metaphor. He compares Twoodo to a combine harvester which integrated many farming tools years ago and it allowed for more efficient work in the fields. Simple and brilliant. A great way to catch attention.
3. Don’t specify what problem are you solving.
In most cases the clients will pay for your product if it solves their problem. If this problem doesn’t exist, you won’t find people willing to give you their money. When you’re presenting in front of investors, the key is to specify what pain and of what group of people are you solving. If you don’t, then you can expect it will be the first question asked.
4. Don’t mention the market.
In perfect situation, the investor to whom you’re pitching, will know your market like the back of his hands. Often it might not be the case, so it’s good to provide some background info on how big the competition is, who are the clients and most of all - how big is the market and how much of it are you planning to grab.
5. Don’t introduce your team.
It’s no news that investors very often base their decision whether invest or not, on who are the people involved in the startup. It’s enough if you dedicate just one slide for the team’s short presentation.
I’ve seen situations where every team member presented a part of a pitch. I advise against it because:
- Rarely you have a team of only amazing presenters,
- For switching between speakers you waste too much time (and I simply love the 1-minute presentations with 3 speakers (sic!)),
- You introduce a bit of chaos which draws attention away from the important information.
So it’s better to present alone and introduce others.
If some of you have experience with the market in which you want to operate - emphasize it. Same if you have the skills needed to create the product (like programming in technology startups) or skills that will add authenticity to what you do (like playing guitar if you plan on producing custom guitars).
6. Use clichés.
“All we need is 10% of the market.” Good luck. Very often the biggest players in the market struggle to get 10%. It’s not that easy.
“We will get huge viral usage.” No, you won’t. Virality is unpredictable and can’t be taken for granted.
“This product will market itself.” Yeah, sure… Unless you’re creating a sales robot (has anyone actually done that?).
“Google will want to buy us.” I highly doubt it, but I wish you that it happens...
“Our projection numbers are conservative.” A million dollars in the first year? Conservative, right...
These clichés are ridiculous. The problem is that they are still used by some of the younger startup founders. Before you commit a blunder, better discuss it with more experienced entrepreneurs - you’ll surely find ones willing to help. Alternatively you can talk to a public speaking consultant.
7. Don’t mention the competition.
Or use another cliché: “we’ve searched through the whole internet and we haven’t found anything like it”. Unfortunately it’s very likely that someone already had the idea you consider so revolutionary. Doing a Google search is definitely not enough (especially that the best place to hide a dead body is on the second page of search results). You should assume that your competition exists.
It’s better to find it and point out some of their flaws and how you plan to avoid them in your product.
8. Don’t include any call to action.
So the pitch comes to an end. Now what? Too often it’s nothing and that shouldn’t be the case. Are you looking for funding? An investor? A cofounder? Developer? Promo? Clients? What/who are you looking for? If you made the effort to present your idea, then do not leave any doubts regarding what was the purpose of all this. Make it clear: “I’m looking for $300 000 for 10% of shares” or “I’m looking for a cofounder who will take care of sales”. And add your contact info. Without a plain call to action your pitch will be just an information about your startup.
All these things are easy to avoid. You only need to put in some time to prepare yourself well and therefore save the presentation and your startup. And who knows - maybe someday you’ll have the chance to pitch your idea to Dave McClure?
Michał Kasprzyk is a public speaking consultant who works both with company representatives and conference speakers (TEDx included) to help them get their messages across. You can reach him at firstname.lastname@example.org if you need help with your speech or simply to discuss this article.