KYODO Consulting Group
The Investor Pitch
Presented by: Young Kwon
Date: 4/30/2014
2
Investment Paradox
Entrepreneurs
Getting to
Yes
Investor
Getting to
NO
3
Want different
Capacity
Has funds
to invest
Successful
Track record
Compatible
Match of
size/stage
Geography
Friendly
No...
3 Levels of Engagement
Emotional Rational Financial
7 Signs the investor
Signs
the investor
is just not
that into you :-(
7 Signs the investor
1“I still don’t know
what you do”
7 Signs the investor
2“Isn’t your product a
nice to have vs.
A real market need?”
7 Signs the investor
3“Is your market really
big enough?”
7 Signs the investor
4“I still don’t understand
how you make money”
7 Signs the investor
5“Are you underestimating
your go-to-market costs?”
7 Signs the investor
6“Couldn’t your
competitors copy you?”
7 Signs the investor
7“Do you have the right
players on your team?”
Pitch principles
Connecting on an emotional, rational financial level
 Storify
Create a well paced, logical narrative.. t...
Components of the Investor Pitch
#1
Real
Problem
#3
Attractive
Market
#2
Unique
Advantage
#4
Compelling
Investment
Pacing your investor pitch
#1 #2 #3 #4
Start End
Real
Problem
Attractive
Market
Unique
Advantage
Compelling
Investment
3 m...
Answering the “So what?”
Focusing a Problem that Matters
No. 1
Real
Problem
Creating Impact
The Company & It’s Solution - Elevator Style
Core Value Proposition : Use a single sentence
Unique Benefit...
Defining the Problem
Paint a picture of who has this pain
Current State : Show the insanity of how customers
address the i...
Your solution to the Rescue
Describe WHAT you do and HOW you do it
Product : What is it
(screen shots, product photos)
Fun...
What’s been Achieved to Data?
Show your ability to succeed : On lots of sweat… little $
Founded (year)
Employees offices
A...
Creating Impact
The Company & It’s Solution - Elevator Style
Core Value Proposition : Use a single sentence
Unique Benefit...
Pacing your investor pitch
#1 #2 #3 #4
Start End
Real
Problem
Attractive
Market
Unique
Advantage
Compelling
Investment
3 m...
Opportunity Awaits
Lots of Room in the markets to scale a Business
No. 2
Attractive
Market
Sizeable Market Opportunity
It’s very Big…. And you can get To IT
Size : What’s being spent today on problem? Build
from g...
Early Customers/Prospects
Nothing really matters till somebody buys something
Status : Closed vs. Prospects and paid vs. F...
Making Money
Where does the growth and profit come from?
Key Metrics: Pricing, Avg. Deal Size
Registrations/Subs., Churn
N...
Acquiring Customers
What’s your go-to-market strategy?
Visibility : Critical to success.. What’s your story?
Lead Generati...
Pacing your investor pitch
#1 #2 #3 #4
Start End
Real
Problem
Attractive
Market
Unique
Advantage
Compelling
Investment
3 m...
Opportunity Awaits
Many of the essential pieces are in place
No. 3
Unique
Advantage
Partners
Show how you can punch above your weight
Role : What value with they add to your solution
Research/Development/Sa...
Competition: Technolgy/Leadership
Creating barriers to entry
Technology : Validate how you are different?
How much market ...
Team & Advisory
The capabilities to execute on the plan?
Company Background: List experience in terms of
key companies eac...
Acquiring Customers
What’s your go-to-market strategy?
Visibility : Critical to success.. What’s your story?
Lead Generati...
Competition Example
We have everything that the market leaders are not:
Simple, Fast, Easy, Secure, Addictive, FREE.
Perso...
Team Example
A Team of experts
 Chris Bryson, CEO
Aeroplan, Warrillow &Co.
 Marc Faucher, COO
Blackberry partners fund
...
Pacing your investor pitch
#1 #2 #3 #4
Start End
Real
Problem
Attractive
Market
Unique
Advantage
Compelling
Investment
3 m...
Opportunity Awaits
Many of the essential pieces are in place
No. 4
Compelling
Investment
How you will Make Money
Key Metrics that Explain the Bottom Line for Investors
Key Numbers : Revenues, Expense, EBITA
Cust...
The Ask
Value & Deal Structure/Term & Use of Funds
Investment Structure/Terms: Type of instrument
(Convertible Debt, Equit...
The Ask
Value & Deal Structure/Term & Use of Funds
Investment Structure/Terms: Type of instrument
(Convertible Debt, Equit...
A Recap : The 4 Components of the Pitch
#1
Real
Problem
#3
Attractive
Market
#2
Unique
Advantage
#4
Compelling
Investment
In the End…. The Investment is in You
A dozen attributes smart investors' look for in startup teams
1. Honesty
2. Vision
3...
7 Signs the investor
1. 쉽고 명확한 설명
최대한 간결, 명확하게
2. 구성원의 역량을 어필
조직, 구성원의 경험, 활동들
3. 회사의 비전
단계별 운영방안
4. 경쟁사와의 차이점 부각
차이점, 당사의...
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Pitchbook kyodo

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The Investor Pitch

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Pitchbook kyodo

  1. 1. KYODO Consulting Group The Investor Pitch Presented by: Young Kwon Date: 4/30/2014
  2. 2. 2 Investment Paradox Entrepreneurs Getting to Yes Investor Getting to NO
  3. 3. 3 Want different Capacity Has funds to invest Successful Track record Compatible Match of size/stage Geography Friendly No directly competitive investment Strategic Relevant portfolio The Right Investor Team Skills & Track record Platform Significant Technological advantage Market Sizable and Addressable Traction Early customer IP& Biz Model Entry Barriers The Right Investment Entrepreneurs want…. Investors want….
  4. 4. 3 Levels of Engagement Emotional Rational Financial
  5. 5. 7 Signs the investor Signs the investor is just not that into you :-(
  6. 6. 7 Signs the investor 1“I still don’t know what you do”
  7. 7. 7 Signs the investor 2“Isn’t your product a nice to have vs. A real market need?”
  8. 8. 7 Signs the investor 3“Is your market really big enough?”
  9. 9. 7 Signs the investor 4“I still don’t understand how you make money”
  10. 10. 7 Signs the investor 5“Are you underestimating your go-to-market costs?”
  11. 11. 7 Signs the investor 6“Couldn’t your competitors copy you?”
  12. 12. 7 Signs the investor 7“Do you have the right players on your team?”
  13. 13. Pitch principles Connecting on an emotional, rational financial level  Storify Create a well paced, logical narrative.. think storyboard  Disnify Use visuals – frameworks, graphics and image.. But only where they make sense… you are not keynoting a TED talk  Personify Relate to the team’s personal experiences… investors are in the people business  Simplify Avoid too much detail, overused buzzwords and jargon getting a term sheet after first meeting is not the goal  Quantify Show how you make money for the investor. Show key metrics  Verify Can you finish this sentence? As evidenced by … Back up your claims wherever you can with visible proof
  14. 14. Components of the Investor Pitch #1 Real Problem #3 Attractive Market #2 Unique Advantage #4 Compelling Investment
  15. 15. Pacing your investor pitch #1 #2 #3 #4 Start End Real Problem Attractive Market Unique Advantage Compelling Investment 3 min 4-5 min 4-5 min 3 min *Note : Elapsed times are guidelines only
  16. 16. Answering the “So what?” Focusing a Problem that Matters No. 1 Real Problem
  17. 17. Creating Impact The Company & It’s Solution - Elevator Style Core Value Proposition : Use a single sentence Unique Benefit : Focus on one single aspect of what you do(aka…. “The Big Idea”) Metaphors : Try to create a cognitive connecting to something people understand i.e. metaphor “Cover = Uber for restaurants or Rent Frock Repeat = Zipcar for Designer Fashion” Emotion: Create a visceral response (why are things still done this way?) Be provocative… Nice to have’s aren’t investable Start Min 3 Introduction Key Message : We’re fixing the insanity of the status quo
  18. 18. Defining the Problem Paint a picture of who has this pain Current State : Show the insanity of how customers address the issue today Historical Evolution : What’s changed in the customer’s mindset Personas : Describe the main players in your markets you address Pictures : Every pictures tells a story Start Min 3 Introduction Key Message : We’re solving real pain… not “nice to haves” Problem
  19. 19. Your solution to the Rescue Describe WHAT you do and HOW you do it Product : What is it (screen shots, product photos) Functionality : The Who + Do Benefit : High level value Category : Where do you paly?Start Min 3 Introduction Key Message : Our solution is novel and easy to understand Traction Solution Problem Stage : What is the readiness of the solution?
  20. 20. What’s been Achieved to Data? Show your ability to succeed : On lots of sweat… little $ Founded (year) Employees offices Advisors Product Release(s) Beta Users/Unique views/Registrations Paying Customers Partners (Technology/Channel) Certification/Industry awards Media Coverage Patents Start Min 3 Introduction Key Message : Our team is committed and can execute Traction Solution Problem
  21. 21. Creating Impact The Company & It’s Solution - Elevator Style Core Value Proposition : Use a single sentence Unique Benefit : Focus on one single aspect of what you do(aka…. “The Big Idea”) Metaphors : Try to create a cognitive connecting to something people understand i.e. metaphor “Cover = Uber for restaurants or Rent Frock Repeat = Zipcar for Designer Fashion” Emotion: Create a visceral response (why are things still done this way?) Be provocative… Nice to have’s aren’t investable Start Min 3 Introduction Key Message : We’re fixing the insanity of the status quo
  22. 22. Pacing your investor pitch #1 #2 #3 #4 Start End Real Problem Attractive Market Unique Advantage Compelling Investment 3 min 4-5 min 4-5 min 3 min *Note : Elapsed times are guidelines only
  23. 23. Opportunity Awaits Lots of Room in the markets to scale a Business No. 2 Attractive Market
  24. 24. Sizeable Market Opportunity It’s very Big…. And you can get To IT Size : What’s being spent today on problem? Build from ground up. Can the market support multiple players? Addressability: What’s the reasonable market you can serve? Segments : Going Niche or broad? Global : identify other markets Proof : Use 3rd party analyst reports Thought Leadership : Are you using primary research to gain insight? Charts : Keep it visual and engaging Min 3 Min 10 Market Size Key Message : We have unique insight into the market
  25. 25. Early Customers/Prospects Nothing really matters till somebody buys something Status : Closed vs. Prospects and paid vs. Free Trail Categorize : Key segments etc Contextualize : Why they bought Evangelists : Customers quotes to validate market pain and size Min 3 Min 10 Market Size Key Message : We have buyers who must have our solution Customers Personas : Describe customers characteristics Logos : Categorize… Avoid “logo soup”
  26. 26. Making Money Where does the growth and profit come from? Key Metrics: Pricing, Avg. Deal Size Registrations/Subs., Churn Note : Costs to Acquire is perhaps the most overlooked and important metric Competitive Scenarios: Is your model sustainable if competitors start stealing share? Have you factored in potential of downward price pressure over time? Min 3 Min 10 Market Size Key Message : We have validated our revenue model and can demonstrate how it will allow us to scale the business Customers Revenue model Channels : What are the downstream costs to sell and service the customers(is this built in?) Registrations/Subs., Churn
  27. 27. Acquiring Customers What’s your go-to-market strategy? Visibility : Critical to success.. What’s your story? Lead Generation Programs : What marketing approaches will you use(stay high level – categorize) Min 3 Min 10 Market Size Key Message : We have validated our revenue model and can demonstrate how it will allow us to scale the business Customers Revenue model Sales Model : Direct vs. Channel (Do you have partners? Have you built a wave for channels to ride?) Marketing & Sales Systems : Do you have an infrastructure to scale (CRM/Inbound Mktg. Platforms etc.) Testing : Do you have cap ability to test value prop./offers? Stages : Do you have the ability to pivot from launch to growth to maturity
  28. 28. Pacing your investor pitch #1 #2 #3 #4 Start End Real Problem Attractive Market Unique Advantage Compelling Investment 3 min 4-5 min 4-5 min 3 min *Note : Elapsed times are guidelines only
  29. 29. Opportunity Awaits Many of the essential pieces are in place No. 3 Unique Advantage
  30. 30. Partners Show how you can punch above your weight Role : What value with they add to your solution Research/Development/Sales/Support etc. Reputation: Do you have the right players in the market you are serving? Category Fit : Do they have sufficient market power? Executive Sponsorship : Do you have buy in from Key people inside the channel? Incentives : Is the partner aligned financially to support you? Longer Term : Is there competitive threat or potential M&A? Min 6 Min 10 Partners Key Message : Important market players buy into our vision and want to work with us
  31. 31. Competition: Technolgy/Leadership Creating barriers to entry Technology : Validate how you are different? How much market lead do you have? What degree of leverage and scale do they create? Process : Are there unique process elements of how your technology works? Patents : What is the focus of the patent and what stage are you at? (provisional filling, patent granted) Not a bad idea to mention any name brand attorneys you work with) Min 6 Min 10 Partners Key Message : We’ve nailed a problem that is hard to solve. It will be hard for competitors to catch up Competition Technology/Leadership Licenses : Are there 3rd party components of your Solution that are licensed? Do you have an exclusive right to the technology?
  32. 32. Team & Advisory The capabilities to execute on the plan? Company Background: List experience in terms of key companies each team member worked for list “pedigrees” (notable exits) Achievement : Focus on a key aspect of their experience that uniquely qualifies them for the venture Min 6 Min 10 Partners Key Message : We have assembled the right mix of people who understand our target customers and the dynamics of the marketplace. We have “know how” and “know who” Technology /Leadership Team & Advisors Planned Hires : Speak briefly to what primary role they will play in the venture New Hires : Where applicable, speak to any key people you may be hiring to build out the team
  33. 33. Acquiring Customers What’s your go-to-market strategy? Visibility : Critical to success.. What’s your story? Lead Generation Programs : What marketing approaches will you use(stay high level – categorize) Min 3 Min 10 Market Size Key Message : We have validated our revenue model and can demonstrate how it will allow us to scale the business Customers Revenue model Sales Model : Direct vs. Channel (Do you have partners? Have you built a wave for channels to ride?) Marketing & Sales Systems : Do you have an infrastructure to scale (CRM/Inbound Mktg. Platforms etc.) Testing : Do you have cap ability to test value prop./offers? Stages : Do you have the ability to pivot from launch to growth to maturity
  34. 34. Competition Example We have everything that the market leaders are not: Simple, Fast, Easy, Secure, Addictive, FREE. Personal and Biz Drag and Drop Bank Feeds Easy Set-up Free Multiple Business Invoicing Cloud Based Collaborative Intuitive interface YOU Comp 1 Comp 2 Comp 3 Comp 4
  35. 35. Team Example A Team of experts  Chris Bryson, CEO Aeroplan, Warrillow &Co.  Marc Faucher, COO Blackberry partners fund  Amr Hiram, VP IT SAP, Red Iron  Diego Maniloff, Lead Data Scientist MIT
  36. 36. Pacing your investor pitch #1 #2 #3 #4 Start End Real Problem Attractive Market Unique Advantage Compelling Investment 3 min 4-5 min 4-5 min 3 min *Note : Elapsed times are guidelines only
  37. 37. Opportunity Awaits Many of the essential pieces are in place No. 4 Compelling Investment
  38. 38. How you will Make Money Key Metrics that Explain the Bottom Line for Investors Key Numbers : Revenues, Expense, EBITA Customers, Headcount Burn Rate: What is the net cash out month Assumptions : Be prepared to defend them Scenarios : Be able to speak to impact of various scenarios (i.e Cost of acquisition is x % higher than forecast or lack of conversion from free to premium)Min 10 End Financials Key Message : Our venture clearly offers a superior return for our investors.
  39. 39. The Ask Value & Deal Structure/Term & Use of Funds Investment Structure/Terms: Type of instrument (Convertible Debt, Equity) and what are the terms of the deal Amount : What’s been raised and what is left in the round? Use of Proceeds : What milestones will you achieves(with the investors money) Min 10 End Financials Key Message : Our structure and terms should meet you investment criteria Offer Details Runway : What amount of time does the current money buy (can you hit breakeven or is new round required?) Pipeline : Be prepared to speak to who is committed so far and who are you approaching. You must show momentum – ‘herd dynamics.” Valuation : Be careful about “premature” discussions discussions regarding pre-money value-don’t price from the podium!
  40. 40. The Ask Value & Deal Structure/Term & Use of Funds Investment Structure/Terms: Type of instrument (Convertible Debt, Equity) and what are the terms of the deal Amount : What’s been raised and what is left in the round? Use of Proceeds : What milestones will you achieves(with the investors money) Min 10 End Financials Key Message : Our structure and terms should meet you investment criteria Offer Details Runway : What amount of time does the current money buy (can you hit breakeven or is new round required?) Pipeline : Be prepared to speak to who is committed so far and who are you approaching. You must show momentum – ‘herd dynamics.” Valuation : Be careful about “premature” discussions discussions regarding pre-money value-don’t price from the podium!
  41. 41. A Recap : The 4 Components of the Pitch #1 Real Problem #3 Attractive Market #2 Unique Advantage #4 Compelling Investment
  42. 42. In the End…. The Investment is in You A dozen attributes smart investors' look for in startup teams 1. Honesty 2. Vision 3. Resourcefulness 4. Logic 5. Drive 6. Humility 7. Leadership 8. Critical Thinking 9. Commitment 10. Patience 11. Credibility 12. Agility Gives straight answers to investor questions Demonstrates customers insight/though leadership Can make an investor’s dollar go far Makes wise, pragmatic decisions quickly Genuine passion for early stage & ability to excite Coachable an seeks help to address weak spots Has the ability to attract and lead a winning team Challenges assumptions and spots the false ‘+s Not just involved – sweat & or capital invested Tolerance to the ambiguity of innovation Well research. Uses data to back assumptions Decisive. Cuts losses & pivots at the right time
  43. 43. 7 Signs the investor 1. 쉽고 명확한 설명 최대한 간결, 명확하게 2. 구성원의 역량을 어필 조직, 구성원의 경험, 활동들 3. 회사의 비전 단계별 운영방안 4. 경쟁사와의 차이점 부각 차이점, 당사의 비즈니스가 특별한 점 5. 하나의 틈새 시장 공략 모든 분야가 아닌 틈새 시장 집중 초기 포지셔닝 6. 재무제표에 대한 이해 돈, 시간, 조직운영에 대한 방향 7. 명확한 이점 and 한계점 여러분의 비즈니스가 왜 중요하고 그것이 시장에 어떤 이점을 주는지 현재 부족한 점 향후 어떻게 극복해 나갈 것인지 설명

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