5 words to have in mind when pitching your start-up idea
Everyone loves a pitch. For those presenting its time to show your idea and thinking to the world in the hope that investors leap at the chance to support you and invest. For those sitting in the audience it’s a chance to stumble upon the next Facebook or Task Rabbit.
Getting your pitch right takes skill and attention to detail. You need to consider your presentation, attire, whether you consider using a demo or how much detail you give away regarding growth plans and revenue forecasts.
Every pitch is different but I’ve found the following 5 words a good set of guide-rails to use when putting together your pitch.
What is the overall experience you’re hoping to deliver for customers? Think beyond the product or app. Be clear on what the end-to-end experience or journey is for customers. Outline how you intend to acquire and retain customers and how you’ll eventually nudge them to recruit others.
A good way to impress investors is to show how you intend to add value beyond the first experience iteration. For this, it’s good to think about how you might exploit opportunities before, during and after the experience you are selling.
Be warned that selling a product before an experience isn’t a great idea. Remember it’s often the offline experience you’re selling and the product is just an access point.
Show how effective your experience, service and product are in meeting the customer challenge you’ve identified. You need to demonstrate how your ideas are stripping away waste and adding in value. Don’t forget to show how you’ll work to gather and act upon user feedback.
Investors will want to see numbers. They’ll want to know your plans for recruiting a customer base and growing it. They’ll also want a view on projected revenue vs. costs. From the very beginning you’ll need to demonstrate that you’ve validated your market size.
When looking to the future be sure to show how the gap between costs and revenue will widen with the former dropping as you take advantage of economies of scale.
Make sure you’ve got tight numbers that don’t scream ‘made-up’.
Be candid about how you intend to subtract as well as add to your start-up. Adding functions, teams and systems is easy but showing how you intend to evolve and subtract wasteful elements will give confidence to investors.
Show investors how you intend to develop through experimentation. Give them examples of ideas you’d like to test with your growing customer base. Illustrate how you’d continually test new features and experiences. Talk about what you’ve learnt from others and what ideas you’d like to adopt and try yourselves.
Being open to experimentation will give investors confidence that you won’t have your head stuck in the sand when some difficulties arise.
5. And finally… Resilience (damn it, couldn’t get that final ‘E’).
Very little goes right first time. Lots of entrepreneurs talk about not having a plan B as it often means you lose focus. That is easy to say when you’re wealthy and Ivy League educated — you can afford not to have one. For the rest of us, having a plan B is basic common sense.
Most investors during a pitch will ask difficult questions that can trip you up. They may ask how your model would withstand a slowing China or what would happen if regulators took a dim view of your idea. Make sure you thrash out possible scenarios and have a plan up your sleeve.
To all those pitching in 2016 good luck! :)