Embed Size (px)
Citation preview
Intelligent Pitching
• One of three great lessons about writing and communication in general– Know the mind of
your audience• Everyone pitches
– You either sell or you work for someone who sells
The Virtuous Circle of Intelligent Pitching
What do you want them to
think next?
Persuade them
What are They
Thinking?
Know Your audience
Cast Your Spell
Assess Your Impact
Cast Your Spell: Attach to the Highest Wish(es) You Can
• Convincing them that you can “save costs” (Wish #6) is no good if you may make them “look like an idiot” (Woe #3)
• Attachment cannot be superficial– “This will make you
look good to your boss” is a turnoff remark, not a turn-on
My Daughter’s Braces
Pleasing my Boss
Not Looking Like an Idiot
Am I a good person?
Increasing Revenues
Saving Costs
World Peace
Pity the Poor VC• We listen to lots of
presentations– 10,000 for me?
• Never had a presenter ask what’s on my mind
• Most presenters– Want to “get” me– Don’t want to “get” where
I’m coming from• What’s on an investor’s
mind?• How do you use that in
your pitch?
The Typical non-Solution Pitch
• Starts on “Market Need”– “World is desperately in need of <x>”
• Stays on “Market Need” for ~30% of pitch• Superficial Market Size slide– “If we could get <x>% of <huge market>”
• Very little attention to team• Very little attention to competition• Very little attention to financials• The “ask” is at the end
The PaaP Test• “Person At a Party”• “If someone walked up to you at
a party and did <x>, what would you think”?
• “Party” a good proxy for a presentation– The investor(s) and presenter(s)
don’t know one another– Establishing context and
connection is key– Timing of The Ask is important
What’s Wrong with the “Typical” Pitch?
• PaaP test:– Someone comes up to you at a party and starts a long
monolog about a “market need”– E.g.., “Lots of research shows that eating at an Italian
restaurant and going out to a jazz concert is vital to building relationships”
– Eventually they tell you they’re a “serial dater”– At the very end, they ask you for a date
• Reaction?– (with apologies to Forrest Gump)– “Run Forrest, Run”
What would an Intelligent Pitch for investors look like?
• Take cognizance of three investor thought patterns that are essential to understanding a Solution Pitch
• Fear vs. Greed• Managing Risk• Exit Arithmetic
Investor Mind: Fear and Greed
• Investors cycle between– Fear: “they will lose my money”
• Suspicion is the BFF of Fear– Greed: “I will miss out on an oppty to make a killing”
• Manic Haste is the BFF of Greed
• Investors flip back and forth between Fear and Greed with nothing in between
• In fact, the same presentation bullet point can do both– “Google has shown that the user base for online docs is huge”
• [Greed] $2.50 x each Google Docs user = $$$• [Fear] OMG, Google could take this over
Investor Mind: Managing Risk
• Control– Board representation/control– Blocking rights, other terms
• Dribs and Drabs– Tranching– Milestones
• Due Diligence
Investor Mind: The Exit
Company needs to grow to $55M in revenues in 4-6 years
Company needs to sell for $165M to
get 3.3x return
Tech companies sell for 3x revenues
$10M buys 20% of
company
Need 4-6x to wow backers
Need 3.33x return to
break even
70% of companies
fail
$100 M Fund
A Better Pitch 1: How to Start• Be clear about
– Who you are– What you’re asking for– What you’re going to do
• Speaks to Fear and Greed– You’re not asking the investor to buy a pig in a poke
• Speaks to Managing Risk– You’re offering your bona fides
• Speaks to PaaP Test:– Introduce yourself– Say why you’re talking– Set listener at their ease
A Better Pitch 1: The Framing SlideBrief, Clear Statement of Purpose Bona Fides
of Team
Where We’re At
The Ask
A Better Pitch 2: Market Need SlideGutsy Move: How Will It Affect the Audience?
Paint a Picture of
Customer’s #1 Problem
And How You’ll
Address It
A Better Pitch 3: Market Sizing Slide
Not a Great Bottom-Up, but
Decent
A Better Pitch 3: Competition
Dividing Competitors Into Classes Often
Works
A Better Pitch 4: The Hammacher-Schlemmer Promise
A Better Pitch 5: Are Questions a Diversion?
• Never!• The opposite of interest is boredom, not
questions• Always answer questions• Never stick to the pitch
A Better Pitch 6: How to Tell When You’re Losing Your Audience
• Absence of questions• Playing with tech toys• Body language– Crossed arms, etc.– Lack of eye contact– Don’t worry about poker faces: VCs love to do ‘em
• Fidgeting
…And What To Do About It• Let someone else from your team take over
– Good advice generally, btw• Ask them what questions are on their mind as they hear
what you’ve said so far– A little better than “any questions” at the end of each slide
• Have some props that are not PowerPoint– Gadgets– Mobile app where they have to download the app– Financials that are not on a slide (so they can see them)
• Ask for a bio break!– Looks odd, but better than putting them to sleep
A Few Other Tidbits
• Try like hell not to have people on the phone– Very hard to keep in tune with audience over the phone– If must be remote, start with framing slide and then
stop for questions right away, resume pitch mode only if vibe is good
– Build in pauses and listen really hard for potential interruptions
• Don’t bring the whole crew– 2 people (CEO/CFO, CEO/Tech guy, CEO/Sales)– Let the other person have ½ the prezo, if possible
