What's Your Story - Keys to an Effective Startup Pitch

What's Your Story - Keys to an Effective Startup Pitch

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  Miami University Proprietaryand Confidential © 2016 Miami University What’s Your Story? Keys to an Effective Startup Pitch Tim R. Holcomb Ph.D. Cintas Chair in Entrepreneurship
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  Miami University Proprietaryand Confidential © 2016 Miami University Common reasons why investors say “No”  You solve a problem that no one cares about  You fail to identify an addressable market or you target an addressable market that’s too small or you target the wrong market altogether  Your solution to the problem is unclear or your solution is not technically feasible  Your solution is not sufficiently unique or you have no clear barriers to entry  You have no clear way to monetize the value that your solution creates or you have no clear way to sufficiently scale the business  You have underestimated what resources are needed to scale the business or you have set unrealistic expectations about the financial returns, growth … or both
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  Miami University Proprietaryand Confidential © 2016 Miami University What is a pitch?  A pitch tells a story about your startup:  what problem you’re trying to solve and why,  who your target customer is and why,  what features of your solutions are most valuable and why,  what your journey entails, and  what you need to make it happen  It crosses the barriers of time and makes others care about the problem you’re solving
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  IMPRESS INVESTORS BY… answeringtheir questions BEFORE they ask them
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  DRIVE CURIOSITY TOGET A SECOND MEETING… An effective startup pitch is not the end-goal. Securing funding is. Leave investors wanting more.
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  THINK STORY FIRST… Peopleare driven by emotional resonance, which makes telling a story in a compelling way at least as important as having a compelling story to tell
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  Miami University Proprietaryand Confidential © 2016 Miami University Every time you pitch, you’re telling a Story
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  Filmmaker Andrew Stanton("Toy Story," "WALL-E") — Key to the Pitch: Make Me Care
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  I’ve learned thatpeople will forget what you said, people will forget what you did, but people will never forget how you made them feel. ~Maya Angelou, an American poet, memoirist, and civil rights activist who published seven autobiographies, three books of essays, several books of poetry
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  Miami University Proprietaryand Confidential © 2016 Miami University Keys to a compelling story  Invoke wonder … make the audience care  Match the worldview of the audience  Make a promise  Push the audience to want more  Don’t simply appeal to logic … appeal to the senses  Be intentional … make the audience work for their meal without knowing they’re doing so  Don’t contradict yourself … be consistent and authentic Michael Siebel (Y Combinator Partner) — Keys to a Great Investor Pitch
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  LEAD WITH ANEED Effective startup pitches begin with a compelling purpose, a why that helps the audience “feel” the pain and sets the tone for the pitch. Why should investors care? 1
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  UNIQUE SOLUTION FEATURES Tellinvestors what’s unique about your solution. Describe how you incorporated customer feedback. How do customers solve the problem today? How are you different? 2
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  LARGE ADDRESSABLE MARKET Givespecifics about your target customers. Also, investors want to know that a “large enough” addressable market exists. Help them visualize the data from your market research. Why did you select this group of potential customers? How large is the market? Do you plan to serve more than one market? If so, why? And how large is each one? 3
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  TALK ABOUT MARKETINGAND CUSTOMER VALIDATION Be sure to incorporate feedback from potential customers. Tell investors how you will build awareness about your solution with target customers and to convert and retain those customers. How do know they will use it? What are your assumptions? 4
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  DESCRIBE YOUR BUSINESSMODEL Investors want to know how you will serve the market and how you plan to make money. How much are customers willing to pay for the value you offer? What type of revenue will you produce? What will it cost you to acquire and retain customers? How will you protect your advantage? 5
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  SCALABILITY AND GROWTH Investorswant to know how many people you think you can get to use your solution within the first 12-18 months after launch. How will you grow the business? How quickly can you generate positive cash flow? What percentage of your revenues are considered recurring revenues? What are your key milestones? 6
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  RESOURCE ASSUMPTIONS AND NEEDS Tellthem what you know about the startup’s financial and human capital needs. How much financial capital do you need? When do you need it? How will it be used? What key positions do you need to fill in the organization? Why? How do you plan to manage rapid growth? 7
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  DEMONSTRATE WHY THISTEAM IS THE TEAM TO DO IT Inspire confidence in the investors that this this founding team is the right team to make it happen. Emphasize the education and experience of each team member. Does your team have previous startup experience? Who is your technology lead? Do you have a board of advisors? 8
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  KEEP IT SIMPLE Makesure your pitch slides are easy to understand, organized in a way to tell a compelling story that answers investors’ questions before they ask them, and free of complicated numbers or highly technical terms. 9
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  BE CONFIDENT, NOTARROGANT AND DON’T GET DEFENSIVE In the end, investors are investing in you. Demonstrate confidence in your pitch. Answer each question directly and as quickly as possible. Know that investors are going to ask questions and while you may not like what they have to say, remain calm and keep your voice at an even tone. 10