4 Key Steps: This Is How Successful Entrepreneurs Pitch Their Startups
Real life is not like ‘Shark Tank.’ Here’s how to get it right when it counts.
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You've got an idea -- a great idea -- and you can't wait to get in a room with hungry investors.
But solidifying your pitch is a combination of thoughtful planning and preparation, so take some time now to get ready.
The average startup pitch has mere seconds to get (and lose) the attention of a potential backer. As an angel investor, I've been eating, breathing and sleeping entrepreneurs and their ideas. And before this iteration of my career, I was out there pitching, just like you.
Here's how to nail it.
1. Create your story.
Before you pitch to anybody, it is vital that you have condensed your idea into a 15-20-slide deck that is able, in an elevator-style fashion, to cover the following most salient points:
- What's your product?
- What's your market?
- What's the demographic?
- What's your business model?
- What's your marketing strategy?
- Who's the competition?
- Who's the team?
- And what do you need to execute it in terms of money and how you would spend that money?
The simplest way for anyone, whether you live in a big or small city, to get the feedback you need on your pitch is to take your smartest top 3 or 5 friends, and run through your idea with them.
And while you litmus-test your idea with them, listen carefully to the questions they ask and what they don't get. Without being defensive, recognize that your friends likely have a lot of common sense. If they're questioning something, so will your average or even best investor.
Before I started LearnVest, I went to my five smartest friends and they chewed up my idea. Two friends flat-out didn't get it. I could tell one was trying to figure out what the heck I was talking about. Most crushingly, one friend didn't love the name. This was post-incorporation, by the way, after thousands of dollars were spent securing that name, so that was a terrible feeling. What I focused on, instead of being offended, were the questions that all five asked. Those were the ones I knew I'd hear again. And thanks to that exercise, I now had thoughtful answers and real strategies to fix their problems. I re-tooled, and re-ignited.
In short, before you even hit an investor, trial-run your strategy and your plan and your deck on your friends in a low-risk way.
2. Build your board.
Now, fundraising looms. The free and smart way to get started on that is to gather a team of advisors that are willing to get behind you and make intros to great investors on your behalf. Your board of advisors should be the people who are the most committed to and passionate about your idea.
As I was starting LearnVest, I didn't know a lot of people who were sitting on piles of capital ready to throw at startups (surprise, surprise; most people don't). So instead what I did was find a bunch of people who really cared about my idea and got them to commit to being an advisor for a small amount of equity. Who knows -- some may even invest. But that's not the goal here.
From there, those people started to help make intros to the right people for me. This should be an instinctive step, but I find that a lot of times, it's skipped.
3. Repetition is key.
When it's primetime, there's only one thing to remember: Practice makes perfect.
You wouldn't show up for an acting tryout without having read your lines a thousand times. The same goes for your pitch. Run through the material. Talk it out in front of a mirror. As awkward and stupid it sounds, confidence is the most important thing here. And confidence comes with being prepared. Feel like you've done this before, because you have.
For me, confidence and calm always came when I felt extremely well prepared. That meant sleepless nights where I'd stay up until 2 a.m. in front of a mirror, as stupid as I felt. I was a varsity diver in college, so practice is all I did. I applied that discipline to my embarrassing mirror sessions. I practiced why I cared, why I mattered and got ready for the hard questions.
Perfecting your pitch is a moving target. So you should constantly be updating and changing your deck. I would version-control my deck so that I started with LearnVest version 1 but by the time I was presenting, I was using LearnVest version 58. I was always making sure that I was putting in place my best input.
4. Know your audience.
Are you meeting with a partner? A general partner? An associate? A principal? Someone who's been an entrepreneur? Someone who's been a banker? Have they failed at a startup? Do they know what it feels like? What do they care about? What companies have they invested in? Find out.
My most major meeting was was with Ann Kaplan, one of the first female Goldman Sachs partners, who is extremely passionate about helping people better understand investments. A Columbia Business School student had told me that she really cared about my same passions, and as a result our first meeting turned into fireworks. Now, we have a long-term friendship. I know that I nailed that first sit-down because of that background information. When I showed up, I didn't feel like I was in uncharted waters. I knew who she was, and I could be myself.
Ultimately, remember -- resiliency is key. All of us are going to make mistakes and have bad days, but you have to be able to put yourself back on your own two feet and do it again. And again, and again and again.