Getting Pitch Perfect: Lessons From Techstars
Your pitch is an asset to you and your startup. I’m not just referring to the digital asset of an audio recording or video. It’s an intellectual asset that is critical during the fundraising period. Not only is it critical in order to have crisp, powerful statements in regards to any and all investor questions, but the process you have to follow to truly understand and communicate the vision of your business is an invaluable one. I wish we wouldn’t have put it off until now.
A lot of entrepreneurs and investors criticize startup accelerators for how much time they make founders allocate to developing their pitch. I can see where their distaste comes from, however, I found that we created the most compelling aspects of our pitch by spending time on it daily while at TechStars Boulder. We finally found — through iteration — a way to put to words what we were feeling, and the vision we had for our company.
Our mentors were incredibly helpful during this process. We spent multiple sessions with many mentors, going over little things like which words to use where, and where to throw in little pauses. For the first time ever, we got extremely nit picky about developing our presentation. Little details like this were exhausting, but made all the difference in my confidence and delivery when Demo Day arrived.
Of course, it never hurts to have the founder and former CEO of a $2 billion technology company from your same industry introduce you before you pitch.
I’ve embedded the video footage of our pitch from Demo Day as a resource to you. It’s certainly not perfect, but hopefully it will give you some good ideas for your own pitch. We watched over 100 other startup pitches, extracting things we liked from each as we developed our pitch. I want others who are crafting their own pitches to see our pitch as another data point. Following the video, I’ve provided what I believe to be (1) the “essentials” of pitching, (2) a great way to structure a pitch, and (3) the “DOs & DON’Ts of pitching.
The content of your pitch is actually secondary. What investors really want to feel and see during your pitch is natural, unwavering passion for what you are doing. The bad news is, passion can’t be faked. You either possess the passion for what you’re doing, or you don’t. It either keeps you up at night, or it doesn’t. You won’t be able to hide it if you’re not completely consumed by the thing your company does.
An investor once told me his favorite thing about a pitch is when he thinks he knows exactly where it’s headed, but is then surprised by something the entrepreneur says or does. He said, “You are truly excited about something you normally don’t care about, and you want to give the person your money because they just changed you, or convinced you to change your mindset.” What this investor is saying is, you have to be very deliberate about your presentation. Instead of relying on industry facts and jargon, tell a compelling and surprising story. Give your audience a reason to have more excitement and optimism about your industry and venture than they had before they met you.
Our brains use two different systems of thinking, and yes, investors’ brains are just like yours and mine (although they sometimes seem fundamentally different). The two systems are intricately explained in Daniel Kahneman’s book Thinking Fast and Slow. System 1 is your fast, intuitive, and automatic mode of thinking. System 2 on the other hand, is your slow, methodical, analytical mode of thinking. As Kahneman explains, “The idea is that System 1 is really the one that is the more influential; it is guiding System 2, it is steering System 2 to a very large extent.”
Think of the systems as two separate little people living inside the investor’s brain. System 1 is the watchdog, always on high alert. He’s the fun one of the brain, and is always looking for something exciting or interesting. He doesn’t have the ability to analyze complicated information, but leaves that work to the boring System 2. He doesn’t think things through, but reacts to things on the fly. His job is to make snap judgements, not think slowly through problems. His ultimate purpose is to guide System 2, and awake him in the event that there is important information to be analyzed. System 2, on the other hand, is always in the background sleeping. He only wants to be awoken if there is highly important information to analyze. He’s the ornery, but intelligent occupant of the brain.
Most entrepreneurs pitch to System 2 by stuffing their pitch full of logical facts and numbers. Little do they know, System 2 is asleep, and System 1 isn’t paying attention or alerting System 2 because the information doesn’t seem exciting or interesting. In order for you to communicate with System 2, you first have to grab the attention of System 1. The two best ways to appeal to System 1 are fear and greed. In the first few minutes of your pitch you need to either get the investor fearing that if they don’t invest they’ll “miss out,” or experiencing a hit of dopamine at the thought of making loads of money. Once you get them experiencing those feelings of fear of “missing out” or greed, System 1 will tell System 2 to wake up and pay attention. Only at that point can you rely on logical data.
As I mentioned, we don’t have all the answers. The suggested structure that follows is simply one way to structure your pitch, but it is one that was rigorously developed over weeks and weeks of consistent effort at TechStars Boulder. I’ve found that this structure works extremely well for most situations:
Hook — 20 seconds to make me pay attention. What can you say to grab my attention? What storylines could you use (Hero’s journey? Origin story? Customer story? Awesome traction? Industry trend?)?
Problem description — up to 40 seconds, no industry jargon, simple/crisp, make it bleed.
Solution description — clear statement of how you solve the problem and what is different/unique.
Demo (what might you want to show, what situation may you want to demo) — up to 1 min demo / product walk.
Business model — how do or will you make money
Go to market strategy — which customers will you target and how will you reach them?
Traction — what traction has your company achieved? Revenue, customers, etc.
Opportunity — what is the bigger opportunity here and why will investors get excited?
Team — what is your background and why are you the team to do this?
The ask/close — what do you want the audience to do (invest? Buy? Tell friends? Find you for a meeting?)
DOs & DON’Ts
Allow me to give you a few DOs and DON’Ts for your pitch. We’ve learned these over months of consistent practice, failure, and learning.
DON’T wing it
Every pitch we’d done before Demo Day we had winged from simple bullet points. We always created the pitch and deck within 48 hours of needing it. This might work if you were just reading facts verbatim from your slide, but remember, presenting facts doesn’t get investors writing checks. You need to get the investor feeling fear or greed, and that takes a lot of practice and iteration. You need to appeal to System 1.
DON’T fear feedback
During TechStars, we practiced our pitch on everyone. We pitched our MDs three or four times a week, we pitched other people at dinner, while walking in random improvised settings. Anytime we saw an opportunity to get out of our comfort zone, practice our pitch, and get feedback, we took advantage.
DON’T think your audience will understand
Your audience likely knows nothing about your company. You can’t assume that they will catch your vision from the start. In fact, assume the opposite, and make sure that it’s so simple that someone there for the first time will catch on to your vision. You want to get people excited within the first 10–20 seconds. If you don’t simplify your vision you will create dissonance between you and your audience.
DON’T drag it out
The most impressionable pitches to me are those with less. Less is always more. Be crisp and concise in all of your slides. After watching each company at TechStars pitch on Demo Day this lesson couldn’t be more clear. What you do as a startup can often be complex, and involve deep explanation, but the best entrepreneurs can explain their vision in a matter of seconds.
DO hire a designer to design your pitch deck
We found it incredibly helpful to hire a designer to help with our deck. I’ve always been one to design my own deck, but the problem I’ve run into is I focus too much on design and not enough on the content of the pitch. By doing something as simple as hiring a designer I created a bunch of time for myself to focus on nailing the content and delivery.
DO practice over and over
You will need to practice much more than you think. Practice walking, practice in front of people, practice with a mic, practice without a mic, practice in conversational tone, practice in more of a formal tone. We even practiced our pitch while people hurled ping pong balls at our faces so we were ready for anything. It’s a little untraditional, but just try it and you’ll stop thinking we’re insane.
You need to treat your pitch like Michael Phelps treats his Olympic events. Here’s what he told an interviewer, “At the age of 11 my coach told me I could make the Olympic team in four years, so I said ‘Okay, I want to make the Olympic team, so that’s what we’re going to do.’ And I started training for that. I went five straight years without ever missing a workout. Every single day, 365 days a year.” You see, we only watch the Olympic star winning outrageous amounts of gold on TV, and we think, “Dang, what a natural athlete!” But in reality, he won those gold medals on the days when no one was watching him, or expecting him to show up.
DO make it a group effort
You can’t just lock yourself in a room and think you’re going to come up with a great pitch. Open a Google Doc and invite everyone you know to read and rip apart what you’re writing. We had angel investors, managing directors, PR people, venture capitalists, engineers, product people, and lawyers all read through our pitch to give us their two cents. That amount of feedback, and the differing opinions, are what made our pitch grab serious attention from all types of people.
DO decide on a script well before you pitch
You need to decide on a script early enough to give you a significant amount of time for presentation and presence. We chose a final script much earlier than a lot of the other teams in the program, and although we could have spent a lot more time finding exactly the right words to say, we compromised and spent more time on delivery, body language, and enunciation. I think this was one of the biggest contributors to the success of our pitch.
DO spend a third of your time on the Hook and Problem Description
The first minute, nay, the first thirty seconds, are the most important part of the whole pitch. If you can hook someone in that first few sentences, you will retain almost everyone for the rest of your pitch. Research has shown that we now have a shorter attention span as humans than goldfish. Your audience could be doing thousands of things with their time other than listening to you. Don’t let them down.
We found this especially hard because not only were we talking about older people and history (genealogy), but also a subject that makes most people yawn when they hear the word. There is nothing sexy about genealogy. So, we took two main approaches to conquer this in our beginning slides, as you will see. We added an element of humor and creativity in order to get people interested.
I’m not the smartest tool in the shed, and have never been the smartest. That said, we owned who we are, and didn’t try to be something we’re not. We’ve gotten the feedback from people that our team is cheerful, fun, and funny. People enjoy being around us. That’s our thing, so we capitalized on it.
We incorporated humor into our pitch. For others it may be easier or more natural to impress with knowledge or stats. For others still it will be easier to impress with uniqueness or novelty. Look, I won class clown in high school, so humor seemed like the most natural tone for our pitch.
In working on the delivery we ensured that if part of the script didn’t feel like something I would say, or didn’t work well with who I am, we removed it. We had some really strong, intelligent phrases in the script for a while that weren’t written by myself, but suggested by someone much more intelligent, and we took them out because I couldn’t deliver them naturally.
Pitching well is the gateway to fundraising, and only the beginning. Without the ability to effectively communicate the vision of your company, you’ll never raise substantial money. Without substantial money, you’ll never be able to realize your vision. Despite common belief, you aren’t simply born with the ability to pitch. You create the ability to pitch in yourself through hours and hours of painstaking practice and hard work. And it’s all worth it. Your pitch and vision will be an asset for attracting mentors, evangelists, customers, employees, and investors.
As usual, please keep Medium a conversation and let me know what you think. Connect with me at wesleyeames.com