TheInvestorPresentation

TheculminationoftheNewVentureChallenge(NVC)isa15minutepresentationtoagroupof
distinguishedinvestors.Fifteenminutesisaveryshorttimetodistillanentirebusinessplanand
describeallthekeyaspectsofyourbusiness.Leavethedetailsforyourwrittenbusinessplan.The
presentationshouldfocusonthemostimportantpartsofyourbusiness.Becarefulnottospend
toomuchtimedescribingtheproductorservice.Theinvestorsaremoreinterestedinthe
businessmodelandhowyouwillmakemoney.Beclear,conciseandcompelling!
Thepurposeofthistutorialistoprovideyouwithanoutlineforyourpresentationthatwillinsure
thatyoucoverthemostrelevantpointsin15minutes.Thetutorialwillalsoprovidefilmclipsof
pastNVCpresentationsasexamplesofhowtoconveyyourstorywithpassionandconcise
information.
Pleasenote:Thisisasuggestedoutline.Giventhenatureofyourbusinessandtherelative
strengthsandweaknessesofyourbusiness,youmaychoosetochangetheorderofthefollowing
keyelements.
Keyelementsofaninvestorpresentation:
1.
2.
3.
4.
5.
6.
7.
8.
9.

TheOpening
ProblemandSolution
Market
Competition
SalesStrategy
BusinessModel
Management
FundingRequest/ExitStrategy
Closing

Thistutorialwillalsopresentinformationon:

QuestionandAnswersession/AppendixSlides
PresentationTechniquesandTips

1. TheOpening
Theopeningofyourpresentationisveryimportant.Peoplemakeadecisioninthefirst30
secondsaboutwhetherthey'regoingtolistentoyou.MalcolmGladwellinBlinkdiscusseshow
onesmindtakesabouttwosecondstojumptoaseriesofconclusions.Gladwellbelievesthose
instantconclusionsthatwereachareverypowerfulandreallyimportant.Sobemindfulasyou
approachthefrontoftheclassandbegintomakeeyecontactwiththeaudience.Eveninthese
veryfirstmomentsofyourpresentationyouaremakingsomesortofimpressionwiththejudges.

Goalsforyouropening:

Gettheirattention(positivereaction)
Givethemareasontolistenfurther
Establishcredibility
Buildrapport

TypesofOpenings:
a) TheElevatorPitch
Provideaquickoverviewofwhatthecompanydoes,howitisdifferentandhowitwillmake
money.Useananalogytoquicklyconveywhatthebusinessdoesandhowitispositionedin
themarketplace.Example:GreenBuildwillbetoHomeDepotasWholeFoodsistoSafeway.
b) TellaStory
Tellastory,apersonalanecdotetodescribeasituationwhereyourproduct/servicecanbe
used.Makesurethatyouraudiencecanidentifywiththissituation.Thistypeofopening
drawsyouraudienceintothestoryofthebusiness.Youcaneasilybuildrapportwithyour
audience.Makesureyourstoryishardhittingandverysuccinct.
c) BuildCredibility:
InvestorsforgetthatstudentsoftencometoaMBAprogramwithconsiderableexperience.If
youhaverelevantentrepreneurialstartupexperience,takeafewsecondsatthebeginningof
thepresentationtointroducetheteamandstateinonesentenceyourexperience.Youwill
havemoretimelateroninthepresentationtoelaborateonthemanagementteam,soatthe
beginning,justbuildcredibility.
2. TheProblemandtheSolution
Whatisthecurrentproblem?Andhowdoesyourbusinesssolvethisproblem?
Thesetwoquestionsmustbeaddressedattheveryoutsetofthepresentation.Forsome
businessesthiscanbequicklyaddressedwithanexample.Formoretechnicalbusinesses,thiscan
beachallenge.Youhavetoassumethattherewillbesomejudges/investorswhodonot
understandyourtechnologyoryourindustry.Consequently,youwillneedtodescribethe
problemandyourproduct/serviceinaverycomprehensiblemanner.Analogiescanbeusedvery
wellinthissituation.
Trytoaddresshowpainfulthisproblemis.Themorepainful,themorelikelyyouwillhave
customerstobuyyourproductorservice.Quantifythepainputadollarvalueonit.
Havingidentifiedtheproblem,nowyoucanpresentthesolution.Determinehowmuch
informationyouraudienceactuallyneedstounderstandyoursolution.Inmanycasestheydonot
needtoknowthedetailsofhowatechnology,productorserviceworks.Throughtheuseofa
graphic,picture,anecdoteorsimpleexplanation,succinctlyprovideenoughinformationforyour

audiencetounderstandthebasicprinciplesofyourproductorserviceandhowitsolvesthe
problem.
3. TheMarketOpportunity
Nomatterhowgreatyourproductandserviceis,youdonothaveaviablebusinessunlessyou
haveasizablecustomerbaseormarket.Investorswanttoinsurethatyouhavetargetedthemost
lucrativemarketsegmentandthatthemarketisbigenoughtoallowforsignificantgrowthanda
favorablereturnontheirinvestment.Herearethetopicsthatshouldbeaddressedinthemarket
opportunitysectionofyourpresentation.
1. IndustryDynamics
Succinctlydiscussthefollowingquestionstoprovideanoverviewofthetrendsinthis
industry.

Isthismarketgrowing?
Atwhatrate?
Whatfactorsareaffectingthisindustry?Technology,regulations,globalization,
consolidation?(Cautiondontdiscusstheveryhighlevelbroadtrendsthatdont
addvalue.Mostinvestorsgetirritatediftheyfeellikeyouareeducatingthemona
market.Tellthemsomethingtheydontknowthatisveryrelevanttoyourbusiness.)

2. MarketSize
Therearetwonumbersthatshouldbeaddressedtodeterminemarketsize.
a)TheBigPictureNumber
Thisnumberdescribesthesizeofthisindustrycurrentlyand/orinthenearfuture.This
numbershouldgrabtheinvestorsattentionandindicatetothemthatthereishuge
opportunitywithinthisindustry.Userevenuenumbers.
Example:Thisindustrywillgrowto$6billionin2010.
b) AddressableMarket
Itisunlikelythatyourbusinesswilltargetcustomersthroughouttheentireindustry.
Consequently,itisimportanttosegmentthemarkettoshowthesetofcustomerswhowill
mostlikelybuyyourproductorserviceyouraddressablemarket.Inapresentation,oftena
slideisincludedthatshowsthistopdownmarketsizing.[ViewPowerPointslide#1]

Avoidstatingthatthemarketforyourproductorserviceishugeandifyoujustcapturex%,you
willbea$Xbillioncompany.Suchastatementdoesnotshowtheinvestorsthatyoutruly
understandyourtargetmarketorhowyouintendtocapturethatx%.
MarketingandSalesStrategy
Nowthatyouhaveidentifiedyourcustomer,howareyougoingtoselltothem?Willyoubeusing
aninhousesalesforce,resellers,theinternet?Whatchannel(s)isoraremostappropriatefor
thisbusiness?Howdoyouknowthis?Whatdoesyourcompetitionuse?

Outlineyourmarketingstrategyandtheuseoftradeshows,collateralmaterial,directmail,PR,
salesincentives,etc.Thisinformationwillprovidetheassumptionsbehindyourmarketingcosts.
Doesyourproductneedsupportandservice?Doyouneedtohelpyourcustomerunderstand
yourproductbeforebuying,duringinstallationandinuse?Whowillprovidepreandpostsale
support?
4.Competition
Avoidthesestatements!
Wehavenocompetition.
Wehavethefirstmoveradvantage
Ifyoudonothaveanycompetitionitmeansthatyoudonthaveanycustomers,youhavenot
doneenoughresearchoryouwillhavecompetitionsoon.
Inmanycases,themostcriticalcompetitioniscurrentbehavior.Whatdopeopleusenow?Will
theychangeandadoptyourproductorservice?Also,beawareofsubstitutes.Howelsecanthe
customersolvetheproblemyourproduct/serviceaddresses?
Analyzeyourcompetitionwithrespecttokeyfeaturesandbenefitsofyourproduct/service.How
doesyourcompetitionrateacrossthesefactors?Includethosebusinessesthatarenotonlyin
directcompetitionwithyourbusiness,butalsoothercompaniesalongthesupplychainthatcould
beyourcompetitioninthefuture.Inaddition,rememberthatsomeofthecompetitioncouldturn
intopartnersoracquireyourbusinessinthefuture.Discussthesepossibilitiesaswell.[View
PowerPointslides#2and#3]
5.BarrierstoEntry
Whatareyourbarriers to entrythatwillkeepothersfromduplicatingyoursolution?Whatdo
youhavethatisproprietary?Barrierstoentrycanincludeintellectualproperty,customer
contacts,timealreadysunkintodevelopment,etc.
6.BusinessModel
Thissectionisoneofthemostimportantsectionsofyourpresentation.Howareyougoingto
makemoney?Howwillyougenerateenoughprofittointerestaninvestor?
1) Revenue:
Thereareseveralquestionsthatmustbeaddressedinordertoconvinceinvestorsthatyou
willgeneratesignificantrevenue:
a) Pricing:Howdoyoupriceyourproduct/service?Howdoesthiscomparetoyour
competitionortoothersubstitutesinthemarketplace?Example:Ifyouarea
softwarecompany,youmighthaveapriceforcustomizationandinstallation,an
annualsubscriptionorlicensingfeebasedonthenumberofusers,andanotherfee

forupdatesandmaintenance.Areyourcustomersalreadyfamiliarwiththispricing
scheme?Haveyoutestedthemarkettoseeifcustomerswouldpaythisprice?

b) SalesCycle:Howlongdoesittaketoconvertaleadtoasale?Ifyouunderestimate
thelengthoftimetocompleteasale,youcouldrunoutofmoneyveryquickly.

c) RevenueAssumptions:Baseyourassumptionsonbottomsupmarketsizing.Inother
words,lookatyourtargetmarketandprovideassumptionsonhowmanysalesyou
canactuallymake.Example:Youaretargeting10clientsinYear2andfrompast
history,youknowyoucanconvert40%ofyourleadstosales.Themorespecificyour
revenueassumptions,themorebelievabletheyaretothejudges/investors.

d) Scale:Howwillthisbusinessmakemoneyovertime?Willthegrossmargins
continuallyincreaseovertime?Howwillthebusinessexpandgeographically?

2) Expenses
Showoneslidethatshowstheuniteconomicsofonetransaction.[ViewPowerPointslide
#4].Iftheproductrequiresfurtherdevelopment,youmaywishtoshowaproduct
developmenttimelineandthecoststhatwilloccuratdifferentpointsintime.
3) Projections
Nowthatyouhaveprovidedtheassumptionsforyourrevenuemodel,youcanpresentthe
financialprojectionsforthenextfewyears.Itisrecommendedthatyouillustratethe
projectionsgraphicallyinthepresentation.Showtheprojectedrevenue,expensesandnet
income.Linegraphsofthesethreeelementswillindicatethegapincashflowandthebreak
evenpoint.Youcanincludemoredetailedfinancialsintheappendixincasethereisa
questionregardingyourprojections.[ViewPowerPointslide#5].
Ifyouhavedifferentstreamsofrevenuethatvaryovertime,youmaywishtopresentthis
revenuegrowthinadifferentway.[ViewPowerPointslide#6].
7.FundingRequest
Yourfinancialprojectionsshouldillustratethegapincashflowandthereforeapproximatethe
amountoffundingyourequire.Itisprudenttoaskformoremoneythanisindicatedsincefor
mostbusinessesthisamountisalwaysunderestimated.Youshouldalsomentionthatyouare
askingforafirstroundoffinancingthatshouldtakeyoutoaparticularbenchmarkandthatyou
knowyouwillrequireadditionalroundsoffinancinglater.
Prepareaslidethatshowstheuseoffundsandthesourceoffunds.Thetotalsforboththese
tablesshouldbeequal.Intheuseoffunds,itisbestnottoaggregatethesalaryfigure.Instead,
assumethatsalaryamountsarecontainedwithinthebudgetsallocatedformarketing,technology
development,etc.Intheuseoffundstable,theinvestorswillwanttoseehowmuchthe
managementteamhasinvestedtodateinthebusiness.

8.ExitStrategy
Theinvestorsultimatelywanttoknowhowtheywillobtainsubstantialreturnontheirinvestment
iftheyinvestinthecompany.Ifyoucan,providecomparablesofsimilarcompaniesthathave
beensoldordoneanIPO.
9.ManagementTeam
Youhavefinishedpresentingwhatyouwanttoaccomplish,nowyoumustconvincethe
judges/investorsthatyouhavethemanagementteamthathastherightexpertiseandexperience
toexecutesuccessfully.
Toooften,presentationsspendtoomuchtimeondescribingalltheaccomplishmentsoftheir
managementteamandtheirboardofdirectorsand/oradvisors.Itisimperativethatyoufocuson
thoseachievementsorexperiencesthatrelatedirectlytothebusiness.Thereisalsoatendencyto
placetoomuchtextonthemanagementslideaspeopletrytorecreatefullresumesontheslide.
Onceagainhighlightkeypastpositionsandnotetheircurrentpositioninthebusiness.Verbally
youcanhighlightthekeyachievements.
CreateoneslideforthemanagementteamandoneslidefortheBoardofDirectors/Advisors.Itis
appropriatetodiscussaholeinyourmanagementteamoronyourBoardthatyouhopetofill
withtheassistanceofyournewinvestors.
10.Closing
Theclosingisoneofthemostimportantpartsofyourpresentation.Thisisthepartwhereyou
cancreatealastingimpressionwiththejudges/investors.Startwithaveryquicksummaryofyour
accomplishmentstodateand/orthekeyfactsthatyouwanttheinvestorstoremember.Show
yourstrengthandpassionandconvincetheinvestors/judgesthatyourcompanyprovidesan
opportunityforreturnsthattheycannotaffordtomiss.
11.QuestionandAnswerSession
ThereisalimitedamountoftimefortheQ&Asessionafteryourpresentation.Itisimportantto
usethistimewisely.Thelastthingyouwanttodoistobelaboroneissue.Haveonepersononthe
teamansweraquestionsuccinctlyandtothepoint.Forsomeanswersabriefcommentcanbe
addedonbyateammembertoshowthatyouareworkingasateam.Thenmoveontothenext
question.
Anticipatequestionsandprepareforthem.Someappendixslidesyoumightconsiderpreparing
include:
1) RisksandMitigation.Thejudges/investorsoftenaskaboutpossibleriskstothebusiness.
Prepareaslidethatliststhekeyrisksforyourbusinessandhowyouwillmitigatethem.
2) FinancialStatementsandProjections:Havethedetailsofyourfinancialsonaslidesoyou
arereadytoansweraparticularfinancialquestion.

3) Technology:Duringyourpresentationyouwilltalkaboutyourtechnologyonahighlevel.
Ifyouhaveinvestorsthataresavvyaboutyourtechnology,youcanpreparesomeslides
thatprovidemoreindepthdescriptionaboutyourproductorservice.

Theinvestorsalsorealizethatthebusinessisstillindevelopment.Acknowledgethatthereare
holesinthemanagementteam,resources,sublicensestoadditionaltechnology,etc.
12.PresentationTechniquesandTips
Youmusthavepresenceandshowpassion!
Showyouarecommittedandengagedinyourface,voice,gesturesandyourstance.
Theimpactofatypicalpresentationis55%visual(howyoulook),38%vocal(howyoutalk),and
only7%verbal(whatyousay).Inotherwords,youdon'tdeliverpresentations,youperform
them.
a) Verbal
Keepsentencesshortandtothepoint.Youneedtosoundintelligent,powerful,polished,
articulate,andconfident.Intoday'scompetitivemarketthesequalitiesarenotoptional,theyare
essential.Atechniqueforbeingmoreprofoundistouseshort,simpledeclarativesentencesand
tocutoutuselesswords.

Usesimplelanguage.Avoidacronymsandjargon

Useactiveverbs

Usecolorfulimagesandusefulanalogies

Practicepausingtogivetheaudiencetimetoabsorbwhattheyjusthaveheard

Voice/verbalenergizing

Slowdown

Varypace

VoiceTools
o Pitchhighorlow
o Tonesomber,enthusiastic
o Inflectionhowoftenyouchangeyourpitchorvolumeofawordforemphasis
lendscolorandinterestinyourvoice
o Articulationclearpronunciationhelpseffectivecommunication

b)

Bodylanguage:WheredoIputmyhands?

Dos

Usenaturalmovementsyouwoulduseinconversation
Varyyourhandgestures
Standinfrontoforonthesideofthepodium,closertoyouraudience
Move

Standtallandconfident

Donts

Dontforceasmile
Dontrockbackandforth
Dontletarmsdroopatyourside
Dontcrossyourarmsinfrontofyourchest
Dontjigglecoinsinyourpocket

c)Eyecontact
Dos

Lookonepersonsquareintheeyeandholdthatcontactforatleastfiveseconds,orone
completethought."It'salmostlikehavingminiconversationswithspecificmembersof
theaudience."

Donts

Dontstareaboveeveryonesheads
Dontpickononefriendlyface
Don'ttrytomakeeyecontactbybecomingasprinklersystemthatscanstheaudience
fromlefttorightandbackagain.

d)Slides
Dos

AvisualaidshouldAid.
Useslidestosupportandenhance,notduplicateordominate.
Useslidestodramatizeandclarify
Becreative
Uselightlettersondarkbackground,orviceversa
Uselargefonts
Projectyourslidesonascreentotestthecolorandreadabilityoftheslide

Donts

Donthavetoomuchtext
Maketheslidescomplicatedandthereforedistracting
Dontmaketheslidebackgroundtoobusy
Dontreadslides

e)Prepare
Prepare,prepare,prepare
WinstonChurchillsaidthathewouldprepare6to8hoursfora45minutepresentation
Practicewithyourgroupandthenpresentinfrontofpeoplewhodonotknowyourbusiness.
Practicewithyourmentors.
Knowyouraudience.Dosomeduediligenceontheinvestors/judges.Knowwhattypesof
businessesthattheyhaveinvestedinthepastandwhichonesweresuccessfulandwhichones
werenot.