Business over Breakfast
“The Art of the Pitch”
Gregory Phipps – Director, Investment
November 28, 2013
Let’s focus on the pitch!
Entrepreneurs have consistent questions:
 What topics are required and what should be omitted?
...
Learn to pitch!
 Pitching and negotiation are
fundamental, necessary business skills

 Learn them!
 Applied to:
 Poten...
Pitch Purpose
 A convincing argument or thesis for investment support
 Create/increase investors’ confidence in your

in...
Do your homework!
You need to know:
 Your unique value proposition
 What you are asking for
 Who your audience is
 How...
The fine art of pitching
What you say
 Explain yourself in the first minute
 Explain the relevance of what you do
 Clar...
A good pitch deck . . .
 Catches the audience’s attention in the first 60 seconds
 Facilitates discussion. Do not simply...
Investors invest in the team
 Investors are looking for a self-aware, founder team that
 Knows what they don’t know
 Un...
Pitch deck – look and feel
 Brand shamelessly – logo on every slide
 Lots of white space
 Single-line titles
 Use 12/2...
Know and understand your audience
 What are the most important things this audience would

like to learn about the compan...
Be prepared!
 Arrive early. Be prepared. Be comfortable
 Listen for objections and feedback – note them
 Be passionate,...
STORYBOARD - A pitch outline
1. Proposition

2. Problem

3. Solution

4. Market

5. The team

6. Business
model

7. Going ...
What the investor wants to know. . .
The Proposition
 Why he/she should be listening to you
 Sets the stage and draws th...
What the investor wants to know. . .
Problem
 Your company is solving a problem that really exists
 What is the solution...
What the investor wants to know. . .
Solution
 What your solution does, not how it does it
 The benefits to the user – n...
What the investor wants to know. . .
Market
 This is a good opportunity that you can build a big

business around
 Demon...
What the investor wants to know. . .
Team
 Why you are relevant as CEO? Are you coachable?
 Link the team’s skills and e...
What the investor wants to know. . .
Business Model
 Know who is buying your product and why
 Understand the economics o...
What the investor wants to know. . .
Go-to-market plan
 How will you efficiently and cost-effectively reach your

market?...
What the investor
wants to know. . .
Competition
 Who are they
 Price vs. value comparison
 Features & benefits
 Why y...
What the investor wants to know. . .
Traction & milestones
 What have you accomplished to date?
 What you are going to a...
What the investor wants to know. . .
Financials Metrics
 That you understand how much $ is required to break even
 Expec...
What the investor wants to know. . .
Summary slide
 Recaps the key elements that would lead the investor to believe

ther...
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The art of the pitch: Pitching angels, corporate venture, VC's for investment

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Some advice and tips on content and approach to "pitching" potential angel investors, corporate investors, or venture capitalists for equity investment.

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  • Most entrepreneurs have consistent questions they ask us about developing their pitchesWhat topics are required and what should be omitted?What is the best way to communicate their message?What depth of information should be provided in a deck?What about really great slides that make it too long? (stick them at the back - just in case)What is the best flow from start to finish? From slide to slide?
  • 1. Learn to pitch you will be doing it throughout the life of your company!2. Financing is fundamental to successpeople frequently think the most fundamental strategy of a start-up is product it isn’t!the most fundamental strategy is a solid financing strategy
  • Pitch Purpose:A convincing argument for the right opportunity and for the right team People frequently think the most fundamental strategy of a startup is the product strategy, in fact, the most fundamental strategy is the financing strategy (and always think about the next round too, it is only a year away)To stimulate interest not to close the deal!Know what you wantIn early stages this is sometimes difficult to determineUnderstand your audienceResearch prospective investors thoroughlyUnderstand the broader financing climateWhat deals have been done recently, who and how muchKnow what you want to sayAn investment thesis is either concept-driven or data-driven, which are you pitching? Use the concept method when your data isn’t that impressiveArticulate your thesis clearly and succinctly
  • 2.0 There’s homework!What are you looking for?A pitch is either concept-driven or data driven. Which are you pitching?Generally early-stage pitches are concept driven because the data isn’t impressiveInternal data is more important in Series A round and beyondExpress your competitive advantageWhat about the risks?Experienced investors know there are always risks, assure them up-front that you too understand the risks be explicit and straight forward explain how you will mitigate risk or say you don’t know/research required
  • What you sayPeople listen to 7% of what you sayThey listen to 52% of your body languageBe excited! Be memorable!Show passionUse pauses
  • A good pitch and deck:
  • The teamRecognize that:Analogies are dangerous! Google, Facebook and Twitter couldn’t describe their companies this way - there were none!!Investors will ask questions and the only wrong answer is not having thought through the possibilities ‘I don’t know because … “ is an acceptable answerElements of your business that are critical or unique must be includedYou should address big elephant-in-the-room questions before they get asked, proving you understand the issues and are not afraid of them, investors may assume you were nervous about the fact or that it is a true weakness in the business if you don’t bring them upDemonstrate you know adjacent and competitive markets, products, companies and models – know your stuff
  •  Deck look and feel
  • Know and understand your audience Different audiences require a pitch tailored to their needs, including:Government economic development program managerCustomerPartner or potential partnerAngel investor or angel networkEarly- mid- or late-stage institutional investorIndustry sector, business model, geographic focus
  • During the presentation
  • THE PROPOSITION (Overview)An investor wants to know why s/he should be listening to youRemember – you have 60 seconds
  • THE PROBLEM - An investor wants to know:your company is solving a problem that really existswhat is the solution? where does it fit?why does it matter?you have the qualifications to solve itwhat is your unique value proposition?The product, the pain and how you will make moneyA VC is looking for traction, market size, and team qualitySteer into investors’ objections, there are usually a few problematic areas for your financing, address them head on and early
  • YOUR SOLUTION - An investor wants to know:WHAT you solution does, not how it does itDon’t go too deep on technical details, unless the investor shows a real interests or asksShow a focus on bottom-up tactical for your strategiesShow your product, rather than saying you will build best-of-breed product - walk the talk!
  • THE MARKET - An investor wants to know:this is a good opportunity that you can build a big business arounddemonstrate the market is significant enough to invest 
  • THE TEAM- An investor wants to know:Why you are relevant as CEO? Are you coachable?Link the team’s skills and experience to: The problem you are solvingThe solutionThe business modelThe marketing & sales strategyUnderstanding the competitionEvery start-up has holes, just own them / fix themNo need to go deep except to answer the points Maybe use name-brand affiliations that add credibilityAdd Board Members and existing investors or advisors to add credibility and references
  • Business Model – An investor wants to:
  • Going to Market- An investor wants to:Avoid going to market the old-fashioned wayKnow what resources and partnerships can you use to get to market faster and cheaper?Channels, price, focusEffective go-to-market strategy that won’t break the bank  
  • Competition- An investor wants to know:That you know the space very well, they depend on you to be the expertYou need to be up and to the far right ( X – Y graph)How are problems presented being addressedA complete overview by competitor (summarized in a chart perhaps)Who are they, and where are they fromCompared to youPrice vs. ValueFeatures & benefitsWhy you are GOOD, not why they are bad, ‘accentuate the positive’
  • Traction/Milestones – An investor wants to know:That you are scrappyThat you have skin in the gameWhether there will be additional rounds of financing
  • Financials & key metrics – An investor wants to know:That you understand how much cash is required to break evenThat this is a good business and that they will be able to make money through their investmentExpected use of fundsLeverage of fundsProduct phase, development timeframesTimeline and milestones (past and future)Cash flowWork it out from the bottom up Consider long sales cycles (perhaps a chart in the back)Underlying assumptions are more important than the numbers!In your back pocket – 18 months at minimum, 3 year projections are standard
  • Summary - the askEnd on a slide that you want people paying attention to – your unique value propositionRecaps the key elements that would lead the investor to believe there is a great opportunity in which to invest and to bring you back for a second meetingDon’t be afraid to ask for the next meeting
  • Transcript of "The art of the pitch: Pitching angels, corporate venture, VC's for investment "

    1. 1. Business over Breakfast “The Art of the Pitch” Gregory Phipps – Director, Investment November 28, 2013
    2. 2. Let’s focus on the pitch! Entrepreneurs have consistent questions:  What topics are required and what should be omitted?  What is the best way to communicate my message?  What depth of information should be provided?  What is the optimal length of slide deck and balance between too little, and too much information?  What is the best flow from start to finish and from slide to slide? 2
    3. 3. Learn to pitch!  Pitching and negotiation are fundamental, necessary business skills  Learn them!  Applied to:  Potential investors  Potential customers  Potential employees/recruits 3
    4. 4. Pitch Purpose  A convincing argument or thesis for investment support  Create/increase investors’ confidence in your investment thesis  Lead them to a shared view of your company’s value/attractiveness  An investment thesis is either concept-driven or datadriven. Which are you pitching?  Almost all early-stage companies pitch on basis the of concept (future opportunities) 4
    5. 5. Do your homework! You need to know:  Your unique value proposition  What you are asking for  Who your audience is  How to tell your story with passion 5
    6. 6. The fine art of pitching What you say  Explain yourself in the first minute  Explain the relevance of what you do  Clarity. Less is more! What you do  Keep it high level  Listen for audience reaction to what you say  Be passionate, dynamic What you show them  The pitch deck 6
    7. 7. A good pitch deck . . .  Catches the audience’s attention in the first 60 seconds  Facilitates discussion. Do not simply read it aloud!  Clearly and simply communicates excitement and     aspirations to potential investors “Own” the story and the presentation Not intended to cover every detail, but leaves them wanting more You’ll know a good pitch - it will pique interest, prompt questions and result in follow-up meetings Practice, practice, practice!!! Know it inside-out 7
    8. 8. Investors invest in the team  Investors are looking for a self-aware, founder team that  Knows what they don’t know  Understands their collective strengths and weaknesses  Can articulate the gaps  Is comfortable NOT knowing all the answers  Has the drive and determination to find and verify every answer  Investors invest in the team so let them get to know you! 8
    9. 9. Pitch deck – look and feel  Brand shamelessly – logo on every slide  Lots of white space  Single-line titles  Use 12/24/12 rule: 12 slides, 24 minutes, 24 font size  Diagrams, graphs and photos supplement  Less is more, it begs further questions and spawns conversation!  Put additional details on backup slides after the “thank you” slide just in case you are asked that question 9
    10. 10. Know and understand your audience  What are the most important things this audience would like to learn about the company  Are there any special issues, landmines, questions, you should be prepared for  Know the organization’s mission, how they are funded, available funds, exit horizon, etc.  Brainstorm with your team on the pitch: what to say; what connections to exploit before you show up 10
    11. 11. Be prepared!  Arrive early. Be prepared. Be comfortable  Listen for objections and feedback – note them  Be passionate, objective and balanced  Defend your position – any good idea has legitimate reasons why it won’t work.  Be contrarian but be right!  Bring one additional member of your team to observe, note questions, watch body language, but have one person do the talking  Check to ensure your audience is with you 11
    12. 12. STORYBOARD - A pitch outline 1. Proposition 2. Problem 3. Solution 4. Market 5. The team 6. Business model 7. Going to market 8. Competition 9. Traction & Milestones 10. Financial & Key Metrics 11. Summary 12. Thank you
    13. 13. What the investor wants to know. . . The Proposition  Why he/she should be listening to you  Sets the stage and draws them in  What is your unique value proposition? (12 words or less!)  Summarize the status of your company and ensure you:  Present a convincing argument that you have an opportunity worth investing in; and,  The right team to execute on the opportunity  Convince investors they will see an ROI in 5-7 years 13
    14. 14. What the investor wants to know. . . Problem  Your company is solving a problem that really exists  What is the solution?  Where does it fit in their company/industry/sector?  Why does it matter?  You have the qualifications to solve it 14
    15. 15. What the investor wants to know. . . Solution  What your solution does, not how it does it  The benefits to the user – not just the features  Is there a difference between user and target for monetization?  Don’t go into the weeds on technology details unless asked 15
    16. 16. What the investor wants to know. . . Market  This is a good opportunity that you can build a big business around  Demonstrate the market is significant enough to invest  Quantify the market size and growth rate 16
    17. 17. What the investor wants to know. . . Team  Why you are relevant as CEO? Are you coachable?  Link the team’s skills and experience to:  The problem you are solving  The business model  The marketing & sales strategy  Every start-up has gaps - acknowledge yours  Add Board Members and existing investors or advisors to add credibility and references 17
    18. 18. What the investor wants to know. . . Business Model  Know who is buying your product and why  Understand the economics of the customer and how much they are worth  Is model scalable?  What is revenue model?  Does model require a fundamental change in customer’s current practice or way of doing business? 18
    19. 19. What the investor wants to know. . . Go-to-market plan  How will you efficiently and cost-effectively reach your market?  What resources and partnerships can you use to get to market faster and cheaper  Channels, price, focus  Effective go-to-market strategy that will enable rapid market penetration and scalability 19
    20. 20. What the investor wants to know. . . Competition  Who are they  Price vs. value comparison  Features & benefits  Why you are GOOD, not why they are bad - accentuate the positive  You need to be up and to the far right ( X – Y graph) 20
    21. 21. What the investor wants to know. . . Traction & milestones  What have you accomplished to date?  What you are going to accomplish next?  That you are scrappy and have skin in the game  Whether there will be additional rounds of financing  When/how much required to reach liquidity? 21
    22. 22. What the investor wants to know. . . Financials Metrics  That you understand how much $ is required to break even  Expected use of funds/Leverage of funds  Cash flow  Consider sales cycles (always longer than stated)  Underlying assumptions are more important than the numbers!  In your back pocket – funding for 12 months (min.)  3 year proforma projections are standard 22
    23. 23. What the investor wants to know. . . Summary slide  Recaps the key elements that would lead the investor to believe there is a great opportunity in which to invest and to bring you back for a second meeting  Reiterates how great the people/team are and why VC should back them with investment  Don’t “corner” investor for decision on the spot, but ask if they need any additional information for delivery, set up in-depth demo, arrange for customer reference calls, and anything else that can support their positive decision 23
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