Getting behind the Perfect Pitch - Harvard Innovation Lab Workshop

Hi Harvard innovation lab : Michael J Skok : Startup Secrets : Perfect Pitch START UP SECRETS An insider’s guide to unfair competitive advantage Getting behind the Perfect Pitch MICHAEL J SKOK North Bridge Venture Partners twitter: @mjskok mjskok.com

Hi Harvard innovation lab : Michael J Skok : Startup Secrets : Perfect Pitch 2 My Agenda (for this workshop) • Checklist for a pitch • Selective drill down • Get behind the pitch • Q&A • NOT how to give your pitch • … a story

Hi Harvard innovation lab : Michael J Skok : Startup Secrets : Perfect Pitch

Hi Harvard innovation lab : Michael J Skok : Startup Secrets : Perfect Pitch 4 Your Agenda • What are you going to cover ? – Example: • Team • Business Overview • Market Opportunity • Value Proposition • Go To Market plan • Business Model • Financials

People

Hi Harvard innovation lab : Michael J Skok : Startup Secrets : Perfect Pitch 6 Team • Founders • Management • Board • Advisors

Hi Harvard innovation lab : Michael J Skok : Startup Secrets : Perfect Pitch 7 Team - Founders – What led you to this opportunity? – What was your specific insight? – How are you uniquely advantaged to build this business? – Relevant life experiences ? – Domain expertise gained? – Teaming – How do you know each other? – Results of having worked together? – TBH: Who else is needed on the team?

Hi Harvard innovation lab : Michael J Skok : Startup Secrets : Perfect Pitch 8 Team - Management • Management – Previous companies, positions • Achievements – $ of value built – $$ Exits

Hi Harvard innovation lab : Michael J Skok : Startup Secrets : Perfect Pitch 9 Note For a more complete discussion of this section, see the presentation at www.mjskok.com on “Company Formation ” http://mjskok.com/resource/company-formation

Orientation

Hi Harvard innovation lab : Michael J Skok : Startup Secrets : Perfect Pitch 11 Business overview “We do xx for yy by uniquely zz” Keep it short and sweet for context and orientation only Get the audience wanting more (this should be consistent with your value proposition and positioning)

Hi Harvard innovation lab : Michael J Skok : Startup Secrets : Perfect Pitch Problem?

Hi Harvard innovation lab : Michael J Skok : Startup Secrets : Perfect Pitch 13 Problem statement What problem are you solving? (uniquely well, for who?)

Hi Harvard innovation lab : Michael J Skok : Startup Secrets : Perfect Pitch Market opportunity

Hi Harvard innovation lab : Michael J Skok : Startup Secrets : Perfect Pitch 15 Market opportunity • Business Pain • Technology Need Urgency: Why NOW ?

Hi Harvard innovation lab : Michael J Skok : Startup Secrets : Perfect PitchValue Proposition

Hi Harvard innovation lab : Michael J Skok : Startup Secrets : Perfect Pitch 17 Value proposition / solution • How you address the pain / need? • Your Product / Service… – What’s unique & defensible about it? – Why is it a breakthrough? – How is it compelling?

Hi Harvard innovation lab : Michael J Skok : Startup Secrets : Perfect Pitch After Before

Hi Harvard innovation lab : Michael J Skok : Startup Secrets : Perfect Pitch 19 Value Proposition Before After Vitamin vs. Penicillin Acute Pain Absolute Joy  

Hi Harvard innovation lab : Michael J Skok : Startup Secrets : Perfect Pitch 20 “Gain/Pain ratio” The gain delivered to the customer vs. The pain and cost for the customer to adopt Gain Pain

Hi Harvard innovation lab : Michael J Skok : Startup Secrets : Perfect Pitch 21 “Gain/Pain ratio” > 10 to overcome Inertia, RISK Pain Inertia, RISK Gain >10

Hi Harvard innovation lab : Michael J Skok : Startup Secrets : Perfect Pitch 22 Note For a more complete discussion see the presentation on “Building a Compelling Value Proposition” on www.mjskok.com Or read this article on VentureBeat

Hi Harvard innovation lab : Michael J Skok : Startup Secrets : Perfect Pitch 23 Examples, case studies • PROOF of what you do uniquely well • Articulate from customer viewpoint – Tangible benefits • Easily measured ROI? • Short Payback period? • Articulate from your viewpoint – How repeatable, scalable it is (leads up to how you will make money from it later)

Hi Harvard innovation lab : Michael J Skok : Startup Secrets : Perfect Pitch 24 Vision & Mission • How the market will evolve? • How will you will lead it? • What is your mission?

Hi Harvard innovation lab : Michael J Skok : Startup Secrets : Perfect Pitch If you’re not early with a vision, you’re probably too late

Hi Harvard innovation lab : Michael J Skok : Startup Secrets : Perfect Pitch 26Where does it all fit?Building an enduring company: Vision (Market) Execution (GOSPA) People Team Value Proposition Startup Enduring Cultural Consistency Roadmap Compan y

Hi Harvard innovation lab : Michael J Skok : Startup Secrets : Perfect PitchWhat is the roadmap to achieving your mission? • Market evolution & drivers • Key milestones to address the evolution

Hi Harvard innovation lab : Michael J Skok : Startup Secrets : Perfect PitchMarket Sizing

Hi Harvard innovation lab : Michael J Skok : Startup Secrets : Perfect Pitch Top Down

Hi Harvard innovation lab : Michael J Skok : Startup Secrets : Perfect Pitch Bottom Up

Hi Harvard innovation lab : Michael J Skok : Startup Secrets : Perfect Pitch 31 Market sizing • Total available market – top down – Quote sources like IDC, Gartner, Forrester • Addressable market – bottom up – Clarify basis • Growth – Drivers

Hi Harvard innovation lab : Michael J Skok : Startup Secrets : Perfect Pitch Competition

Hi Harvard innovation lab : Michael J Skok : Startup Secrets : Perfect Pitch 33 Competition • Unique differentiation – Not just technology • Barriers to entry – Rewind, repeat: not necessarily just technology! • What is impenetrable, sustainable? – IP, patents, network, data etc

Hi Harvard innovation lab : Michael J Skok : Startup Secrets : Perfect Pitch 34 Positioning 2x2 Whatever sets you up… for a unique white space High {whitespace} Define real BARRIERS a To entry into each c segment The choice of axes is critical b Bubble sizing for relative size d of competitors Low Low High

Hi Harvard innovation lab : Michael J Skok : Startup Secrets : Perfect Pitch Go to Market

Hi Harvard innovation lab : Michael J Skok : Startup Secrets : Perfect Pitch 36 Go To Market example highlights: • Marketing Plan – Segmentation, targeting, personification – Marketing & Sales cycle – Inbound / Outbound • Sales Plan – Inside / outside pre-sales and sales – Direct / indirect channels & distribution – Services and or product … in sync with business model

Hi Harvard innovation lab : Michael J Skok : Startup Secrets : Perfect Pitch 37 Go To Market Marketing Plan Awareness Interest Understanding Engagement Trial Purchase Sales Plan

Hi Harvard innovation lab : Michael J Skok : Startup Secrets : Perfect Pitch 38 Note! • For a more complete discussion of this area – see the presentation at www.mjskok.com on “Going To Market” http://www.mjskok.com/resource/startup-secrets-going- market Michael Skok

Hi Harvard innovation lab : Michael J Skok : Startup Secrets : Perfect Pitch 39 Business Model: How do you make money? What is your model for • Creating • Delivering • Harnessing VALUE?

Hi Harvard innovation lab : Michael J Skok : Startup Secrets : Perfect Pitch 40 Business Model: Examples:

Hi Harvard innovation lab : Michael J Skok : Startup Secrets : Perfect PitchYour Revenue streams… • How do they align with customer’s interests? • Do they encourage partners?

Hi Harvard innovation lab : Michael J Skok : Startup Secrets : Perfect Pitch 42 Note: For a more complete discussion of this area see the presentation at www.mjskok.com on “ Game Changing Business Models” http://www.mjskok.com/resource/startup-secrets-game- changing-business-models

Hi Harvard innovation lab : Michael J Skok : Startup Secrets : Perfect Pitch Numbers

Hi Harvard innovation lab : Michael J Skok : Startup Secrets : Perfect Pitch Assumptions, Milestones & Metrics are more important than the spreadsheet! E.G. • Key hires • Product beta, ship • First customers • Channel partners • Etc…

Hi Harvard innovation lab : Michael J Skok : Startup Secrets : Perfect Pitch 45 Show me the money!

Hi Harvard innovation lab : Michael J Skok : Startup Secrets : Perfect Pitch 46 Financials • P&L, Cash Flow – One year by quarter minimum – Plus annual up to 5 years thereafter, highlighting – Cash flow positive – Breakeven • Minimum suggested information / detail as needed for the above – Headcount – Bookings – Revenue • May need to break out things like Services depending on your business – Gross Margin – Expenses • Major categories like R&D, Sales, Marketing, G&A shown as needed – Profit/Loss – Cash

Hi Harvard innovation lab : Michael J Skok : Startup Secrets : Perfect Pitch 47 Realistic optimists?

Hi Harvard innovation lab : Michael J Skok : Startup Secrets : Perfect Pitch ? ?!

Hi Harvard innovation lab : Michael J Skok : Startup Secrets : Perfect Pitch 50 Cash raise • Use of proceeds falls out of Financials • Typically 18 months of runway • Highlight key milestones that would set up for next round

Hi Harvard innovation lab : Michael J Skok : Startup Secrets : Perfect Pitch 52 Summary • Why this is a great investment ? • Why do you have unfair competitive advantage? Recap on what you said you’d cover in your agenda, making it obvious why this is a great investment and why your are advantaged to succeed… At North Bridge we look to invest in uniquely qualified teams going after large new markets by solving significantly painful problems with disruptive and defensible new ways to build and deliver value. IE “Game-Changers”

Hi Harvard innovation lab : Michael J Skok : Startup Secrets : Perfect Pitch 53 Backup slides • As needed for the type of presentation you’re doing, or leave behinds you feel will enable the right assessment of your business A typical mistake of entrepreneurs is to cram too much into one presentation. Decide what your call to action is. If it is to gain some follow on commitment to dig in on your opportunity for example, then leave out the material that will come in that follow on meeting. Only present what you need to drive action, and no more. If anything leave your audience wanting more.

Hi Harvard innovation lab : Michael J Skok : Startup Secrets : Perfect Pitch 55 Cap Table (as appropriate) • Major elements, summarizing: – Existing investors % – Founders % – Existing team % – Remaining option pool %

Hi Harvard innovation lab : Michael J Skok : Startup Secrets : Perfect Pitch 57 Exit potential (only if appropriate) • Independent beyond IPO is the ideal • Potential acquirers – Their motivations • Recent transactions in the space – $ paid and valuations basis • Comparable valuations for private / public cos – Data for these like revenues, growth rates, market cap

Hi Harvard innovation lab : Michael J Skok : Startup Secrets : Perfect Pitch 59 As needed for drill down – Examples • Financial assumptions • Screenshots of products • Customer testimonials (if not already worked into the pitch as proof points) • Market data backup … whatever puts you in command of your audience for Q&A

Video from Great Wall Video from the story woventhroughout this presentation can be found by CLICKING HERE

Next steps?

Hi Harvard innovation lab : Michael J Skok : Startup Secrets : Perfect Pitch 62End Note Most of the value of this presentation is in the talk track onwww.mjskok.com in the resource http://mjskok.com/resource/getting-behind- perfect-pitch – Comments and questions are welcome on the site. – Other notes are also available in Slideshare

Hi Harvard innovation lab : Michael J Skok : Startup Secrets : Perfect Pitch Other tips and Resources • As this pitch was NOT intended to help on HOW to present, here are a few ideas on that… • Presenter guidelines – Don’t read your pitch – present it to us, authentically • Get handouts ready in advance if you want your audience to have backup – Make a point only once unless you specifically want to reinforce it – Proof is more credible than talk – wherever possible back your points up with references to customers, or partners or other validation • Recommended reading – www.slideology.com and the book by Nancy Duarte – Presentation Zen by Garr Reynolds

Hi Harvard innovation lab : Michael J Skok : Startup Secrets : Perfect Pitch Thank you… Find Me Online mjskok@northbridge.com mjskok.com @mjskok /mjskok linkedin.com/in/mjskok bit.ly/mjskok-google bit.ly/mjskok-youtube

Hi Harvard innovation lab : Michael J Skok : Startup Secrets : Perfect Pitch START UP SECRETS An insider’s guide to unfair competitive advantage Getting behind the Perfect Pitch MICHAEL J SKOK North Bridge Venture Partners twitter: @mjskok mjskok.com