When pitching to potential investors, conventional wisdom says that you should focus on clearly describing the company, the market, and the proposal’s financials while doing your best to come across as the personable, brilliant, credible marketing-and-technical-genius you are (because otherwise you probably would never have got to make the pitch), and all preferably without having to use a distractingly fancy presentation backdrop as a crutch. Perhaps “clear financials, smart presenter, dumb slides” would be an oversimplification, but I’m sure you get the basic point.
All of which is plausible-sounding advice, for sure: but I’m not sure any of this helps you choose the right starting point for telling a startup sales story. You see, it may well be that you have a whole extra level of work to do in your pitch before you so much as mention your company.
For example: when presenting my own startup Nanodome, I inevitably have to spend a minute or two (or indeed three) warming the audience up to the general idea that security cameras are in fact extraordinarily sexy – specifically, that the kind of “intelligent camera” (or ‘LSL’ – lens, sensor, Linux) that will without doubt centrally define the security industry over the next 20 years is a ‘Cinderella technology’ just about to get its invitation to the Ball. And then I have to put yet more pitching time into explaining why small electronic device manufacturing circa 2011 is also extremely sexy, and nothing at all like, say, British Leyland circa 1970. *sigh*
In some ways, I don’t mind if some of the people to whom I’m pitching then go out and invest in a completely different LSL camera startup – ultimately, not everybody you present to will be perfectly attuned to the precise details of where you’re going, what you’re doing and the way you’re trying to scale your chosen business mountain(s). But if everybody in the audience leaves the room without understanding exactly why you think the whole market you’re aiming at is so utterly awesome, no amount of financial finessing will ever gain you investment.
There’s a similarity with novelists here, in that crafting the first page of a novel is often a challenge quite unlike writing the rest of the book: so it goes with pitches, too. Really, the key presentation problem with real-world business opportunities is that they rarely fall right in the middle of a ‘hot’ investment area (geolocation, etc), and so need a level of introduction: which is why I think you often need pitching ‘foreplay’, to pre-sell your industry.
There’s also a larger picture to consider here, insofar as I believe entrepreneurs are often guilty of being too preoccupied with ‘pure’ money financing, when the realpolitik of angel investing is typically about other issues entirely:-
- self-image – “am I the kind of angel who would want to be associated with this industry?“
- self-validation – “if this startup succeeds, would it make the rest of my business life look even better?“
- mirroring – “does entrepreneur X remind me of myself earlier in my wildly successful career?“
- exploitation/plasticity – “how coachable / malleable is entrepreneur X?“
- controllability – “is entrepreneur X a pussy cat, a wild horse, or a loose cannon? And am I comfortable with that?“
- …and so on.
Naturally, the influence that such interpersonal dimensions have on investment decisions will always be completely subjective, but I remain convinced that it is these kinds of things that contribute most to angels’ first-fifteen-seconds gut reactions. And so as an entrepreneur, you have a yet further aspect to think about: that the way you present yourself in the first minute of your pitch is also crucially important.
For me, the three keywords are normally passion (for a market), drive (to satisfy that market’s needs) and credibility (that you have the right experience and skills to make things happen): but you have to accept that if you find yourself presenting to a room full of cashed-out actuaries, you would probably need to dress these up differently.