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It happens. Some startups can create one slide that shows a line from 0 to 100 million users or $500m revenues in 1 year. Some startups can show a slide with clinical data proving they have the cure for cancer. If you are not one of them, don’t listen to pitch advice by these startups and have some more backup information.
Each pitch has a weak spot to overcome. How to deal with it in your presentation?
Better: admit the issue is there (you scored some realism points in the process). Give an honest defence, but don’t burry the audience in analysis (yet). Wait with that for the 2nd meeting which might have that issue as its sole agenda point.
There are a few levels you can go through as a startup with a VC:
Once you have reached stage 4, the VC will tell you what the issue is. And this is the main issue that needs to be cleared. All the other slides in your presentation have been bought into already. You can give a great presentation, but if you did not manage to convince the investor of the Big Question, then you are not going to land the investment. Trying to hide the elephant in the room is not an option.
The interests of the entrepreneur and the investor are aligned. You want the answer to be “yes”. A good VC might even hand over data sources, give access to people to talk to, to help you make the point. Hopefully it is the start of a long cooperation together.
It is impossible to make a correct 5 year business forecast in an investor pitch. But your financial projection is not really a forecast, a prediction of the future, it is a picture made out of numbers. “If our company will be successful, this is what it could look like”.
Mistake number one is to make the projection ultra precise with 5 digits after the comma. It is just a guess, so a year 5 revenue number of $99,234,318 is not more credible than ~$100m.
But oversimplifying is not right either. The fact that you are for sure going to be wrong does not mean that you simply take 1% of a big market number to get to the year 5 scenario.
The trick is to make the words/visuals in your presentation consistent with your financial model. You are going to sell to millions of individual customers, drive the model that way. You rely on 5 big telco operators, put it in. SAAS company with recurring revenues? Model it. One-off perpetual licenses, use it as the basis of your model.
Teaching investors how the business works is more important than getting the point estimate right.
There are a number of starting points for my presentation design projects that almost always result in great presentations:
Difficult starting points:
Never a dull moment in my profession!
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Now that I am a CEO of an Internet startup (www.slidemagic.com) my email address is slowly spreading in the databases of app developers, PR people, recruiters, marketing consultants, SEO firms etc. Although not in the same quantities, I start getting the type of pitch emails that venture capitalists, journalists, bloggers must be getting.
Most of these emails actually get through spam and other gmail filters. In some way or another, the recipient will look at them. Especially now that mobile devices enable you to kill dead time with gracing through your email field.
The majority of these emails get totally ignored. First of all because of basic hygiene that has been discussed in thousands of blog posts before: generic subject line, generic “hello there” greetings, spelling mistakes in names, etc.
But there is a bigger thing that turns me of: the way they are written.
A good pitch of an idea provokes feedback of the audience. If people are just sitting there, watching politely, smiling, and walking out of the room, you are unlikely to land an investment.
When you get feedback (praise, criticism, difficult questions), it is important to realise who it is coming from. Do people care about you, want to help you? Do you they have the right background?
Pay special attention to people who know what they are talking about, or people that are an example of a type of audience you are going to pitch to a lot (confident, successful investors, that might not fully understand the ins and outs of your market). Group one helps you bullet proof the content, group 2 helps you bullet proof the presentation.
What sort of feedback do you get:
Each investor pitch project is different, each requiring upgrades in specific areas. Here is a list of what I typically encounter. Usually a client did a few right, but needs help in a few others.
In many pitch presentations, I work hard to lift a story to its true potential. Show the bigger picture, put things in a historical context of where humanity is going, visualise the - dreaded word - vision.
In some presentations the opposite is required. The audience will get the dream, but will wonder whether any of this stuff is actually real, or happening within the next 2 years or so, because it all sounds too good to be true, or too expensive, or too science fiction.
Thinking about your audience before you start designing is a cliche from communication trainings. Maybe make it a bit more practical and try to imagine what stereotype people would assign to you after they see/hear you speak for 1 minute.
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The investor or sales presentation is not the only thing your audience will check out:
If you do not have much to share with the public yet on your web site (you don’t have any customers yet, your product is not finished, etc.) it is often better to keep things brief (Coming soon, we are working on […]) in a really crips and professional look, than padding the page with marketing buzzwords and claiming that your are a Fortune500-like company with 20 offices, delivering flexible and scalable ROI to 100s of clients around the world.
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