Establishing Credibility in a PitchJeffrey BussgangHarvard Business School EIRFlybridge Capital Partners General Partner<b...
Context For My Perspective<br />General Partner at Flybridge Capital Partners, early-stage VC firm based in Boston<br /><u...
Context About VCs and Angels<br />Most VCs and Angels have ADD – operate on “BLINK” instincts<br />Want to SEE everything,...
Investor’s Decision Tree<br />Worth 3 minutes<br />(email, phone)?<br />No<br />Worth 30 minutes<br />(phone, in person)?<...
Top 3 Things To Do<br />Be gracious and personable<br />Say something that makes you smile…authentically<br />Tell your pe...
Top 3 Things To Avoid<br />Do not exaggerate<br />Assume everything you say will be verified in due diligence <br />Assume...
Typical Investment Criteria<br />Tangible things investors like to see:<br />Very big market<br />Unfair advantage<br />At...
VCs vs. Angels<br />Will want some control (voting, board, veto)<br />Will want to own 20-40% each<br />Will want to be ve...
Will want to own 1-10%
May want to be engaged or not (often a hobby, sometimes a personal mission)
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Establishing Credibility in an Investor Pitch

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How to establish credibility when pitching investors (VCs or angels) by Jeff Bussgang, Flybridge Capital general partner and Harvard Business School EIR

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Establishing Credibility in an Investor Pitch

  1. 1. Establishing Credibility in a PitchJeffrey BussgangHarvard Business School EIRFlybridge Capital Partners General Partner<br />February 17, 2011<br />
  2. 2. Context For My Perspective<br />General Partner at Flybridge Capital Partners, early-stage VC firm based in Boston<br /><ul><li>40+ active portfolio companies, Fund III (2008): $280M, 5 GPs</li></ul>Entrepreneur-in-Residence at Harvard B-School<br />Former entrepreneur<br /><ul><li>Cofounder Upromise (acq’d by SallieMae), VP at Open Market (IPO ‘96)</li></ul>Author: Mastering the VC Game<br />HBS ’95, Harvard ‘91<br />
  3. 3. Context About VCs and Angels<br />Most VCs and Angels have ADD – operate on “BLINK” instincts<br />Want to SEE everything, but DO very, very few deals<br />Make their decision within the first 10-15 minutes<br />Typical VC and angel will invest in one out of every 300-500 deals they see<br />Long odds – you need to really stand out<br />Like college applicants – triage quickly<br />
  4. 4. Investor’s Decision Tree<br />Worth 3 minutes<br />(email, phone)?<br />No<br />Worth 30 minutes<br />(phone, in person)?<br />Ignore<br />No<br />Worth 60-90 minutes<br />(in person)?<br />Pass <br />gracefully<br />No<br />Worth 2nd mtg<br />(in person)?<br />Pass but stay<br />In touch<br />No<br />Serious due diligence<br />Pass but be helpful<br />
  5. 5. Top 3 Things To Do<br />Be gracious and personable<br />Say something that makes you smile…authentically<br />Tell your personal history, tell a story<br />Be crisp and on point<br />Make it relevant – don’t go off on tangents<br />If you can’t show good summarization skills in a pitch meeting, how will you handle a board room?<br />Keep it short<br />Personal introduction should take no more than 5 minutes<br />Team introduction 10 minutes<br />
  6. 6. Top 3 Things To Avoid<br />Do not exaggerate<br />Assume everything you say will be verified in due diligence <br />Assume the listener is a cynic and a professional BS detector<br />There’s no “I” in team<br />If you are self-aggrandizing, investors will assume you can’t build teams<br />Do not name drop<br />No one is going to be impressed<br />with who you know unless<br />the relationships are both real<br />and relevant.<br />
  7. 7. Typical Investment Criteria<br />Tangible things investors like to see:<br />Very big market<br />Unfair advantage<br />Attractive business model<br />Unique technology or business model approach<br />Intangible things investors like to see:<br />“Pied Piper” – an ability to recruit and retain a great team, partners<br />Interpersonal chemistry<br />Movie, not a snapshot<br />
  8. 8. VCs vs. Angels<br />Will want some control (voting, board, veto)<br />Will want to own 20-40% each<br />Will want to be very actively engaged (they get paid to do this!)<br />Can add tremendous value and be great business partners<br />Can be total disasters<br />Typically rational actors, commercially-driven, but if inexperienced…<br /><ul><li>Will want no control (“send me an annual email”)
  9. 9. Will want to own 1-10%
  10. 10. May want to be engaged or not (often a hobby, sometimes a personal mission)
  11. 11. Can add tremendous value and be great business partners
  12. 12. Can be total disasters
  13. 13. Typically rational, but if unsophisticated: naïve irrational, emotional</li></li></ul><li>Concluding Thoughts<br />SCHOOL<br />Be Specific – do you know your stuff?<br />Be Credible – can I trust you?<br />Be Humble – will I enjoy working with you?<br />Be Optimistic – can you inspire others?<br />Be Original – have I heard this before?<br />Be Large – is the market really big?<br />
  14. 14. Questions?<br />

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