Securing venture capital can be critical to a startup’s growth, but I have found that many entrepreneurs approach pitch meetings with a counterproductive mindset focused on a high-pressure sale. Here are some of my recommended dos and don’ts of pitching your startup to a VC:
#1 — DO spend the first few minutes working to understand your audience.
Instead of diving right in, spend 1–2 minutes at the start of a meeting asking a VC sales-qualifying questions. By doing so, you can better tailor your pitch to your audience and their touch points. Some VCs are more interested in product than metrics (like Ubiquity Ventures), others want to focus on traction, and still others bet primarily on team backgrounds. Asking questions upfront will enable you to make on-the-fly decisions to highlight certain areas and leave others out of a first pitch.
Want to thrill the VC you’re speaking with? Here’s one phrase you could use: “Before I dive into my presentation, can you briefly tell me about your last investment and what got you excited about it? This will help me understand which elements to highlight in my own pitch.”
#2 — DON’T push too hard too early in your pitch.
As the founder of Triangulate back in 2009, I made the mistake in pitch meetings of asking VCs, “How technical are you?” I was trying to determine how much to focus on tech product vs. business in the pitch, but it ended up being an off-putting question; no one wants to say they’re not technical!
Looking back, I should have rephrased the question as, “In a perfect world, how much of our conversation should I spend on tech vs. business?” Ensure that you’re not asking your qualifying questions in a manner that might come across as rude.
#3 — DO make it an authentic conversation.
Having an honest back-and-forth conversation with a VC is key. If you can get through the basics of what the product is and how customers are using it, then you can get to the real meeting: a deeper discussion about this opportunity where you both participate equally. This will help you get to know the VC better and will give them an understanding of how you think on your feet.
Get this right and at the end you’ll both know whether or not it’s a mutual fit.
#4 — DON’T stick to your script too stubbornly.
Remain open to deviating from your pre-defined set of slides when a VC wants to dive deeper. Many entrepreneurs I meet will say, “Oh hold on, let me just finish the next few slides” rather than veer with me. Consider that a VC may have extra context about a sector that may be the impetus for a deep dive into a particular portion of your deck, or they may want to assess how deep your understanding of an area is beyond the slides prepared in advance.
#5 — DO come prepared with timed pitches.
The primary goal of a pitch is to communicate what your product is and why customers are excited about it. Shockingly, in the majority of pitches I receive, I still don’t know what the product actually is 30 minutes into the meeting.
It’s a good idea to prepare a 10-second, 1-minute, 10-minute, and 60-minute version of your pitch. Ideally, you can offer the shortest pitch and then create pull from your audience for each subsequently longer version.
I understand there is a tension between conveying a “very big idea” with high-level words and a long-term vision vs. a very tactical near-term product. There is no agreement among VCs about the sequencing, but ensure that you clearly explain both the near-term product features in plain language and the longer-term vision within the first 3–5 minutes of the pitch.
#6 — DON’T give up your power.
Startup CEOs shouldn’t put VCs on a pedestal, and if you’re doing #3 right you’ll understand that you are simply two equal people discussing their respective goals. But it’s also a red flag if you come across as too casual about the meeting.
I’ve met entrepreneurs who’ve started a pitch meeting by asking, “Well, what would you like to talk about?” It should be clear this is a pitch and that the VC is seeking to evaluate a potential investment, so this nonchalant attitude can be counterproductive. Instead, own the conversation and drive it forward to where you want it to go.
#7 — DO let your people shine.
There isn’t a strict rule about whether to bring co-founders and other executives to a pitch meeting. However, if you do bring anyone else, they should have a prescribed area to cover.
I’ve seen many instances where two co-founders get into a mini-squabble in the midst of a pitch (“oh hold on, go back one slide”, “well, we might not do exactly that”, etc.), and this immediately erodes the VC’s conviction that the team has a solid foundation. Instead, tell your team members the topics you want them to cover and allow them to shine.
A confident CEO pulls in teammates at the right time and with smooth transitions. Highlighting your people and their depth in their functional area will also showcase just how good you are at recruiting.
Are you a founder in the smart hardware or machine learning sector? Let’s talk! Leave a comment or get in touch with Ubiquity Ventures.
Ubiquity Ventures — led by Sunil Nagaraj — is a seed-stage venture capital firm focusing on early-stage investments in software beyond the screen, primarily smart hardware and machine intelligence applications.