Early startup pitches are like movie pitches, not business pitches
Often times, like any investor, someone comes along with a still-in-formation startup idea and asks me what I think. Unlike many investors, I struggle to answer — maybe the question is broken.
Only a tiny proportion of startup ideas are either (a) so compelling that it seems they might “just work” (i.e., execution barely matters if the founders can only prove one thing out, like hard technology problems with unbearably-obvious markets) or (b) so broken that they’re all but structurally guaranteed to fail (e.g., the idea is strictly inferior to something else that already exists or will lose money on every customer forever). For the rest, we have to look at the nuance of how these founders plan to bring this version of this startup to life.
Startups, at the day-zero phase at which we often invest, refuse to obey the laws of regular business physics. Still, we insist on thinking of them as “little businesses” — with strategies, plans, and ways that look more or less like the established companies about which so much has been thought and taught.
Take the funding pitch of even a day-zero startup: Our market is big! We have a strategy to beat our competitors! If you were hiring founders for this startup, ours would get offer letters! Even the fundraising pitch presentation form — slides — follows the format of big company meetings.
Is there a better way to think of it? I’ve seen one example, when I worked in media: though I’ve never greenlit a movie, I’ve been around filmmakers and the executives who finance their pictures. An early startup pitch might be more like a movie pitch than a business pitch.
In a movie pitch, the one-liner of the concept is impossibly little grist for feedback. A treatment of a few pages might matter, depending on who wrote it — or maybe if it’s a wild outlier. “SaaS to help architects design buildings” becomes, in this analogy, “a romantic comedy with people who met in college and are reunited years later.” The question is, how to tell if it be When Harry Met Sally?
Conversely, some of the best-performing movies sound absurd when all you have is the concept. “Tall blue aliens in space who re-enact Pocahontas except one of the aliens isn’t actually an alien, but a human controlling the alien.” Is your startup Avatar? Or is it Ishtar?
(Is early feedback really that valueless? How do early ideas harden into strong companies without the oxygen of feedback? Some founders just get building, and let their code or their customers do the talking — many of the best startups ever skipped past the concept stage before they ever asked for feedback. And, yes, it’s wonderful to have a nurturing response that helps founders discover the kernel of something new. The trouble starts when you begin evaluating an idea too soon.)
So if a startup pitch is like a movie pitch, how do movie producers figure out which movies to back?
It depends on who is doing the pitching. [Edited: My friend who actually makes movies explained this a bit. It turns out, even movie pitches aren’t really about the plot concept! The plot is less the focus than the emotional arc of the story, the reason to care about the characters. Novices tend to get in the specific weeds. They also get caught flat footed on that age-old movie and startup question… why now?]
If you have yet to make a film, maybe you show a reel, or have a short… what little piece of this have you made, and does that make an investor excited to see the rest? That’s one reason demos are so important. It’s a piece of the thing, vs. a description of the thing. Maybe you describe exactly how you’ll cast it, or paint a picture of how the cinematography will work, enough to excite your backer. Some of our openly-posted criteria for investing describe similar signals for day-zero startups.
The flipside of this: who are the investors in an early movie pitch? Early startup investors might be more like Hollywood movie producers or A&R people in music — listening to the tape! — than they are like Actual Businesspeople. The best ones just know what a few bars of good jazz sound like when they hear it.
