Eradicate the startup pitch event
Why pitch events reinforce the wrong things and what we could do instead.
In this post, by “pitch event,” I mean an event where a selected group of startups make presentations to an audience, often with a panel of judges. Quite a common occurrence in startup land.
A year ago I co-founded and began to operate a startup accelerator. That means that I’ve advised startups on everything from their customer segments to the way their monetize to getting distribution and raising money. I also prepared founders to be able to pitch to an audience.
I have ripped apart quite a few startup pitches in private. And along the way I’ve also judged at a lot of pitch events.
But I want to tell you why I can’t stand pitch events and generally advise startups not to participate.
It started years ago, one evening in New York.
I had just heard five pitches from early-stage companies. There was one that still stays in my mind. The founder had the start of a viable business. He was going door to door selling his service with pretty good results and had access to valuable data that people wanted to buy.
He was also the worst public speaker in the world.
I’ve never seen anyone so bad. He was expressionless and boring. I didn’t know what he looked like afterward because he read verbatim from a sheet of paper held up to his face.
But he was the only one there that day with a business. A boring business, but a good one. And he was also the one immediately ruled out as a contender. He’s still in business today (I checked up on him). Not so sure about the others.
A pitch of a few minutes is an awful way to evaluate a company and founding team.
Pitch events are the fast food restaurants of the startup world. Easy to leave feeling full, but not that nutritious.
If anything, pitch events reinforce the wrong message — that the best place to tell your story is in front of other startup people. That companies can be adequately judged by the way they present themselves, in a few minutes. And that entertaining an audience is as important as figuring out your business.
Pitch events are presented as rites of passage, as ways to raise money, as ways to get customers, but they are rarely those things.
They are much more often distractions from working on your business. Startups I’ve prepared to pitch spend lots of time practicing and figuring out what to communicate and how to express it. I’m relentless when it comes to making them better.
These events rarely end with offers of funding. There is even a shift in the usefulness of demo days as a way to raise capital.
Your customers are probably not other startup people or the judges, so why spend so much time in front of these groups?
The winners of pitch events are more often the organizers, not the startups.
I get inquiries like the below email from time to time, either asking me to judge or help find startups to pitch at someone’s event.
Hi Paul. For the past year I have been running [name redacted]. The reason we are doing it is to bring attention to your startups. We are looking for a partner and we normally partner with an accelerator. Being a partner means you help us with venue and promotion of the event and we feature you. Does this sound like a good opportunity for you?
I usually respond like this.
Hi. I’m not clear what benefits your event brings to the startups? I usually don’t encourage startups to participate in pitch events unless possibly if there’s a real prize (not something like free hosting or “publicity”). The startups have so much work to do on their own businesses and that’s usually not at all related to a pitch event. Please let me know if I’m misreading things…
There are entire business models based around convincing startups to spend time pitching at events, getting sponsorship and then selling on top of that things like tickets, conferences, research, or “access” to investors, whatever that means.
Sometimes the applause after pitching is the best feeling a startup founder gets all week.
And that’s a problem. This encourages a narcissistic way of thinking, where we socially reward the cool and the sexy instead of the sustainable. I used to have a cool startup (which wasn’t a great business) and I kicked butt at pitching, so I’m biased here. But the fifteen minutes of startup fame usually end abruptly when the lights go out at the event.
Sometimes the pitches are better than the startups.
By that I mean that the pitches make startups sound better than they are (“the bad start-ups look good”, as Paul Graham said). I know how this happens. Standing up, generating some wonder and sounding like you might have a business is a lot easier than actually building one.
You should be putting that effort into meeting your customers, experimenting, selling. Not adding noise to the startup ecosystem echo chamber.
That is playing at running a startup, not actually doing it.
Judging at these events is a haphazard business, where judgments are ill-informed or influenced by outspoken participants.And I know, because I’ve been able to influence who made it to the top most times.
So why judge at these events? Why not just avoid them all?
There are a couple of reasons.
- I felt like maybe I could be an adequate judge even in the crazy environment of five-minute pitches, followed by five minutes of Q&A. One way I tried to hack around this was to get a list of the pitching companies before the event and research them. While this should be the norm, I guess that organizers do not expect judges to have time to do this. They also may not know who all the companies are beforehand. But where I could, I’d check out the startups, try their services and try to be better informed.
- I thought that the best way to change the norm was from within. I wouldn’t know what happens behind the closed doors of deliberation unless I had experienced it myself.
A few ways forward.
If you want to eradicate a practice, then it’s best to replace it with something else. Here are some ideas for eradicating pitch events.
- Instead of the typical pitch event in front of an audience of startup people, do something like Hackers / Founders’ No Demo Day. Don’t entertain. Demand results.
- Go with a format similar to Startup Weekend or Lean Startup Machine type events, where the pitches are partially there to express the process of discovery the startups went through.
- Go with a more educational format where you share the way you figured out a problem, gained first users, or got to first revenue.
- Instead of attending a pitch event, seek out the events your customers go to. Remember, your customers are probably not startup people. Spend time with your customers instead.
- When you get invited to pitch at an event, write back saying that you’re too busy working on your business to attend. You can forward them a link to this post.
If you think pitch events are more distraction than good, please share this. And if you’d like to stay updated, I have a mailing list here.
After a lot of positive responses, I expanded on this and other topics in a book called Startup Sacrilege. I wrote it in 2014 but made it free July 2016 to reach the rest of the world. I hope you like it.
Paul Orlando is professor of entrepreneurship at USC, runs the USC Incubator, co-founded AcceleratorHK, is Program Director at Laudato Si Challenge startup accelerator, and advises on lean startup for corporates and startups. More about Paul Orlando here.