HOW TO make a perfect pitch

Why are you constantly pitching as an entrepreneur? For those who discover the term pitching right now, this word is used to name the action of presenting your project/company efficiently. There are basically 2 types of pitches (consciously neglecting the sales pitch, which is a bit different): the high concept pitch, which allows you to present what you do in 30 seconds and 1 or 2 sentences. This pitch is also called elevator pitch, because if you meet Mark Zuckerberg, Larry Page or David Marcus (founder of Zong, from Switzerland and who sold his company to PayPal and recently became president of its board!) in an elevator, youd better be efficient to tell him quickly what you do otherwise youll have missed the opportunity! Moreover, a well thought elevator pitch is a MUST HAVE for anyone, as it shows how you can explain your business opportunity to everyone, despite its high technological complexity.

the investor pitch is when you have the opportunity to present your startup to one or more investors. In this case, you have a bit more time but you also should go straight to the point, because time is scarce for everyone (and investors, as any common human being, hate losing time). Your audience is there to listen your pitch, but also other ones. So youd better be well prepared to stand out of the crowd!

Ill focus more on the second one here, as presenting to investors is one of the key skills youll need as a high-tech founder of a promising startup. The only goal you should have for doing a pitch (forget ego, that is, to be the center of attention its not Facebook here!) is always to reach the next step. Which can be to send your complete Business Plan to investors or just to set a meeting. When youre pitching to students, the goal is probably to receive job or internship applications for your current or future hiring needs (remember that a great CEO is always hiring). Make clear in your mind why youd like to be able to pitch to an audience. Already heard about the www principle?

Why? To inform, to motivate, to convince, to provoke. What? Key message.

(c) startupolic 2013

Who? is in the audience? What do they expect, what is their background?

Its important to remember youre pitching to help you go to the next step, not to jump this step during your pitch! Wake up: nobody will sign you a check right after a pitch. The odds are probably better to win the amount required at Euromillions! We often hear founders complain that they hadnt enough time to deliver their entire presentation. Thats absolutely not an excuse, if you fail delivering your message in 5 (or 7 or 9!) minutes, youre probably not prepared enough! The shorter your pitch, the better it probably is. There are some common and regular mistakes we can observe during a pitch: Stuff is too technical: listeners dont have your technical expertise. Too many slides Too much text: the audience will then read your slides rather than listening to you (making your presence yeah, not necessary!). Use always a minimal font size of 30. It helps. Really. Reading your slides: are you telling me that Im not capable of it? The presenter has to add value to the presentation. Generally speaking, its not bad if your slides dont reveal everything without what you say (you can still share a more detailled presentation to investors afterwards) You speak too quickly in order to be able to make your whole presentation: my reaction is that its just becoming noise to my ears and I do not want to hear this disturbing noise longer! Im not saying you cannot bring ENERGY in your presentation, though! Youre constantly looking at the screen, rather than looking your audience! Normally, you should know whats on your slides, no? Be sure you have the laptop screen between you and your audience (so you can still know the slide currently shown), so you can make eye contact with some guys. Look at one persone at a time (do no try to scan every guy in the room). That will help you reduce your nervousness and reading your audience. A good tip is to avoid the pointer! If you absolutely need one, your presentation is probably not clear enough. Or youre not sure enough of what youre presenting me.

The 10 (+1) slides you need

(c) startupolic 2013

As you already know, you just have limited time to make the investor enthousiastic on you or your project. On average:, you just have 5-7 minutes to present your project. Thats quick so youd rather be effective and not wasting any pitching opportunity. The first 30 seconds are crucial, as it will determine if your audience will really listen to you (or just reading their emails or play on their smartphone instead). Youve probably already heard about Guy Kawasakis 10/20/30-rule, which is now really common: 10 slides 20 minutes (5-7 minutes presentation, 13-15 minutes Q/A) 30 minimal font size Id like to share with you how a compelling presentation could look like on 10(+1) slides: 1. Title: this first slide gathers every contact information (people hate loosing time searching such crucial information) and whos speaking, the logo of the company (trivial, but Ive seen people forgetting it) and the on which occasion (event + date) youre presenting. Moreover, display your high concept pitch here: if you have to wait before starting the pitch, people already know what youre talking about and can prepare mentally on what youll telling next. 2. Problem: describe what plausible problem youve identified and whose concerned by this. Where is the customer pain and what can happen to him if you dont solve it? Are you really sure that status quo is a real problem? Use pictures if you can Solution: show the uniqueness and innovation of your product/service (and show it when already possible)! What kind of value are your offering to the customer? Display your USP (Unique Selling Proposition) but dont exaggerate: if you display more than 3, you lose your credibility. Magic Sauce: here and only here can you describe the technology behind your product. Often, hightech startup founder lose themselves talking about technology, so dont makew the same mistake! Try to explain it with pictures and diagrams, the less words the better! Show Proof of Concept, your IP strategy (do you have patents? Dont forget to mention it even if in software domain, youre not really protected investors love to be reassured thats theres a real technological innovation) Market potential: show the size and expected growth of the adressable market (always give information source (market 3

3.

4.

5.

(c) startupolic 2013

research studies) if applicable). You often have to evaluate it with your own assumptions - top down approach is always dangerous (only 1 % of the market). And show your target market (OK, youre targeting a worldwide market but wake up now, you probably have to go step by step and dont have the resources to push your product everywhere from day one). Display you go to market strategy here and some reference customers if applicable. 6. Competition: present how the market lives without you, how it is structured, your competitors and the competing technologies. No competitor, really? Are you sure theres a market then? Rather than showing the weaknesses of the competition, show why youre good and the cost savings / the additional turnover for your potential customers. Value Chain & Business Model: make it clear how it works, how the money flows, show who are your partners (use their logo). And display clearly onetime and recurring revenue. Implementation roadmap: if you can show it as a timeline, do it! What are your achievements (customers, IP, technology, partnerships, R&D project) and on what youll be focussing your efforts during the coming months (respectively: after funding). Include concrete milestones but show only whats important for investors (for instance, investors dont really care about non-value adding stuff like your desk!). Team (+Board of Directors +advisors): show why youre the right team to execute this project. Display a quick CV (name, function, education, experience) with picture of founders/key employees. Dont try to display everyone (even if every team member IS important) as youll lose the impact. If you already have a BoD and not only composed from founders: GREAT, it shows youre surrounding yourselves! And known advisors (academics, entrerepeneurs, etc.) give you an additional credibility (youre not developing your startup in your cellar without talking to people!).

7.

8.

9.

10. Financial overview: dont display everything, only 4 metrics are looked by investors here: sales, EBIT (Earning Before Interest and Taxes), cumulated Free Cash Flow (that is, your capital need), FTEs (Full Time Equivalent). Please avoid graphs, investors can read numbers! Show your financials in a matrix (maximum 20 fields: 4 lines (the above metrics) and max 5. years).

(c) startupolic 2013

11. Financial offering: who current owns your company? Display your financing rounds strategy (be realistic: raise money for 18 months, as raising money often takes 6-12 months - so beware to have 12 months to work on your product!) and your exit strategy (please, dont tell me IPO - who could rather buy you?). Its really common that investors (or at least Business Angels) ask your valuation upfront, but Id advice you not giving it upfront. Rather tell 1mio financing for 10-30% of the company: dont overestimate (forget what youve learnt at business school, like discounted cash-flow, etc.!) but show that youve deeply thought about this, and try to keep a negotiation power (most of the time, you need the money, investors can survive without investing, so there is kind of an asymmetry that is not for your own sake). By the way, for early stage startups, you have always to be open to give 10-40% of your company. Its almost project agnostic and depends of your financing need. Investors make their calculation with a potential buy-out (if youre pitching 10mios: minimal exit is already 10-12 millions and thats unfortunately already not so likely for most projects and if youre not on the market with some good traction, you just loose credibility. If you give 5% too much to your investors who cares? You have the money to keep going, youre aiming big if you have success, that wont matter and if you fail, youll not losing more anyway! Your absolute last slide (OK, thats no more 10+1!) should be a Q&A slide, where you have links to the presentation (presented slides as small pics) and to backup slides (like a detailed financial plan, patent, Marketing Plan, customer list). Display rather pictures of the slide than links. You can also take the opportunity to give hand-outs to the investors in the audience, and youd rather distribute it before start. There is no need to spend lot of money for this and can keep it simple (black and white, 2 slides per page printed both-sides is OK), as youd show potential bad signals (focus on your project rather than paper) and investors rather would have less paper (theyll receive a lot of documents from others startups, for instance). The document youre distributing can have more info than at the presentation and its better, as theyll take it home to read it again quietly! Last but not least, here are some details that could seem silly but that you need to put on your presentation: Add your logo on the slide master (small) and first slide Include page numbers (c) startupolic 2013 5

Use only one level of bullet points Add diagrams, pictures and graphs (except for financials) Use one (1 only!) standard font (and which works on any PC) Watch out for ABBR. (abbreviations), write them out Animate your body and your hands, not your slides!

The soft skills (and more) required for a great presentation

Here, well discuss more about soft skills (or Emotional Intelligence Quotient). But maybe some of you have never heard of what soft skills are, According to Wikipedia, they are behavioral competencies, which are also known as interpersonal skills, or people skills, which include proficiencies such as communication skills, conflict resolution and negotiation, personal effectiveness, creative problem solving, strategic thinking, team building, influencing skills and selling skills, to name a few. Related to your presentation, its the way you interact with your audience. How you speak is as important as what youre saying and how youre moving (be aware of your tics and try to eliminate them). In your pitch, DO: use short and active sentences speak with passion (show you are HUNGRY to succeed!) but slowly share insights (not the efforts to reach where you are (who cares?) and tell the message (not the data behind)) make slow movements change location during the pitch (dont stay frozen on your legs, but also avoid to be continuously moving change location maximum 3 times during the pitch) dress business like when youre pitching investors even if startup is cool and fun, the guys youve in front of you are not exactly in the same world. But DONT: express non words (heu) or fillers (OK, you know) read your slides! put your hands in your pockets! have something in your hands to play with! Youre there to be focused on your audience

(c) startupolic 2013

You can (and should) also use active speech technics: Change verbs from the passive to the active voice: The sample was taken from to A team of four assemblers from the plant took samples from Replace is with an action verb: We found three out of five assembly lines were inefficient. to Poor maintenance contributed to 43% of downtime in three out of five assembly lines. Make an is statement more concrete: We believe the decision is a good one. to The decision will save you $214K per month in purchasing costs. Link assertions to your experience by eliminating seem: The data would seem to indicate that to Our experience in similar situations leads us to suggest that You need to always finish your presentation on some positive notes, like: Repeat the 4 most important points of the pitch Thank the audience for the attention Stay in front of the audience (some people might want to applaud, if youre really good!) Open the discussion, Q&A session Now youve terminated your pitch, but youve done just half of the work. Questions and Answers (Q&A) session is as much important as the pitch. Here are some tips to master this potentially stressing time: 1. First LISTEN & UNDERSTAND, then answer 2. Be humble and open-minded 3. If necessary, reformulate the question (so you can earn some precious time to better answer) 4. Answer as concretely and precisely as possible 5. If you do not have an answer admit it! Take notes, thank for the question and follow up the same day(or as quickly as possible) 6. Never answer a question with YES, BUT, NO, BUT 7. Beware of participants looking for attention: Dont start a debate contest 8. Golden rule: stay calm and never lie Here are some last tips for pitching: Let the CEO present (do not switch speakers in <10mins) Be sexy at presentation Ambition is good but stay realistic: your business wont take off quicker than all the projects out there (think that Dropbox was created 2 years before getting accepted to YC) Know your 10-min pitch by heart (c) startupolic 2013 7

Know the numbers related to your business (revenue, profits, burnrate). You have no excuse like: I dont know, my cofounder who wrote the plan. Yes it is a show: sell your company as if you were selling a product! If there are technical problems at beginning of the presentation, use this time to present yourself (you dont have much time left, youd rather be effective!).

Do not tell those old lies (or try to invent new ones!): Our financial projections are conservative Gartner, Forester etc. says our market will be 100 Mio. in 5 Y. A big company is signing our contract next week Key employees will join us as soon as we get funded Several investors are already in due diligence The big companies are too old, dumb and slow to be a threat Patents make our business defendable All we have to do is get 1 % of the market We have the first-mover advantage We have a world-class team - all out of the same lab? There is no competition (so there is probably no market?) Pitching is the key to open doors not to get financing! Remember what is your goal for pitching? You never make twice the same pitch, as you often pitch to different audiences. So make it clear in your mind and in your presentation. The last but most forgotten tip for a great pitch is probably the preparation and training. As you never get a second chance to make a good first impression, youd better have done your homework before:

know your audience in advance (whos in, what do they want, etc.) be aware of Murphys law: get there early and have your own fallback solutions Have a timer open to know where youre in the presentation think on all potential questions of the investors Perfection is rare, so train yourself! Film yourself, practice in front of your mirror, your family, your friends, employees, partners.

Dont be shy, ask people to review your pitch, even non techies who dont know about your expertise area. But find people desiring to tell you the truth, not people admiring you blissfully or people who always say OK!

(c) startupolic 2013

About the author: @SebastienFlury was a startup mentor for 5 years before starting his first business in 2012. He's also blogging on startupolic.com and hunting deals for an angel investing platform. Since his dive into entrepreneurship, he has seen a few hundreds (or more?) startup pitches, from early stage to mature companies. With this experience and a great presentation from the amazing Jean-Pierre Vuilleumier (Managing Director of CTI Invest, a Swiss Business Angels and Venture Capital association) in mind, he thought that some tips on how to pitch your startup could be helpful. The need for pitch coaching/training is really present, for first time entrepreneurs as well as for more experienced ones. He doesn't pretend to reinvent the art of pitching, but sincerely hope that it will help you make a greater impact

(c) startupolic 2013