Now that I’m using Twitter a lot more I am running across a lot of information that I think is relative to various topics on CBP. I will be reblogging some of these posts in order to share (which is the point of this whole internet thingy right?) One of the questions I get from newer entrepreneurs than myself is how have I pitched to VC/investors. My answer is always, I haven’t. I’ve been working at ARCH and CBP on my own pretty much, but I am planning for when I think I may be able to reach out, or actually be asked by a VC to invest. With that said, I discovered this post on SFVC.com by Phil Sanderson. It’s good stuff and I hope it helps you as well. – Chris B.
The Art of Nailing the VC Pitch
“I hustle hard in any hustle that you pitch”
– Jay-Z, “Hustle Hard“
I have heard over 3,000 pitches in my 18 years as a VC, and only one out of a hundred CEOs truly “nail” the pitch. So assuming you have a good business idea, how do you nail the pitch? You’ll find good advice online; heed the tips that resonate the most with you. But ultimately, an awesome pitch is almost an art form that must combine the five fundamental principles below.
Do Your Research
You have an hour or less to summarize your business, so don’t spend 10 of the 60 minutes asking the VC to describe their business that is already available on the website and blog. Do your research and read everything you can online about the VC: articles, tweets, mentions, and references. If possible, speak to entrepreneurs who know the VC. If certain information is not available online – e.g., what is the VC’s views on a certain market or portfolio company. But do not start out your pitch by asking, “Can you tell me about your firm?”
Focus on the Disbeliever
It is rare that all partners will agree on an investment. You may have a majority of the partners excited about your company, but if one is reluctant, it will often stop the investment in its tracks. Try to determine by questions or body language who the detractor is in the room and direct a question at him or her to engage that person. The last thing you want to do is to leave detractor questions unanswered.
Be Efficient and Read the Audience
Aim to finish in 30-40 minutes, which will allow for questions during and after your pitch. You don’t want to run out of time before your financial projection slide. Additionally, if a VC asks you a question, answer it by moving to the appropriate slide rather than asking him/her to wait. Lastly, check in during the presentation. If you find yourself talking without hearing any questions, it is worth pausing and asking a question, such as “does this make sense?”.
Mix the Medium
To make the presentation more interesting, consider mixing the medium. On a busy day, VCs may hear four or five pitches in the same room in which you are pitching, so try to liven things up. Use the whiteboard in the room, play a video testimonial, provide a handout, let the audience play with smartphone app by passing it around the room. If you are presenting with members of your team, make sure they have face time.
It’s important to ask two questions before you leave: “what do you think?” and “what are the next steps?” VCs often get overwhelmed with pitches, portfolio companies and internal meetings. It is important to have a clear path to your next meeting or follow-up item. Sometimes a quick “no” is best to hear rather than finding out weeks later that there was no interest at all.
Again, research, research, research before your VC meeting. It’s also not a bad idea to rehearse your pitch in front of people who don’t know all the intimate details of your company. Practice pitching with the above five principles. Now go nail your pitch!
Learn more about SFVC.com and Phil Sanderson by checking out the links below: