Pitching to Investors - Part II

In part of the series on Pitching to Investors, we will share our views on an effective framework for pitching. Despite widely available resources on pitching, we find that founders somehow always end up confused.

 

Pitching to Investors

In part 1, we discussed your primary objective of a pitch, what materials can be used to pitch along with a general framework on pitching.

Today, we will share a generic structure of a good pitch. This is nothing fancy or unique, but observations from numerous pitch decks we have had the privilege to look at.

What is a good pitch structure?

The Pitch

  • Mention the company name, logo
  • Name(s) of the presenter(s)
  • Contact information

Overview

  • The deck
    • You can borrow the elevator pitch from here
  • The narrative
    • What is your business?
    • What is your unique value proposition?
    • What is your target market?
    • What was your initial hypothesis?
    • How have you validated your hypothesis so far?

Problem

  • The deck
    • What problem are you solving?
    • Why does the problem exist?
    • What is the opportunity?
  • The narrative
    • Ensure this is a real problem
    • Demonstrate your knowledge about the problem
    • Identify a specific problem and elaborate

Solution

  • The deck
    • What is your solution?
    • Whom are you offering it to?
    • How are you solving the problem?
  • The narrative
    • Emphasis on direct benefits that your solution provides
    • Address the problems that you identified earlier
    • Your objective is to 'Get heads nodding'

Unique Tech or IP

  • The deck
    • What is the technology in your offering?
    • Do you have any IP protections or applications pending?
  • The narrative
    • Focus on your technology being a differentiation
    • Avoid jargon, keep it simple
    • Make it make sense - everyone in the room should understand irrespective of their knowledge or background
    • Do not deep dive - keep it for the next meeting

Team

  • The deck
    • 3 or 4 key persons in the company
    • Relevant credentials and experience
  • The narrative
    • Why is this team the one they should invest in?
    • You just highlighted the problem and probably a complex solution - how do you give them the comfort that your team is the best placed

Market Size

  • The deck
    • How large is the market?
    • How fast is it growing?
    • Any unique trends?
  • The narrative
    • Explain the market dynamics, can you be top 3?
    • What market can be addressed immediately

Traction

  • The deck
    • Revenue or User traction
  • The narrative
    • Mention interest parties, beta testers, first customers
    • How would you define success? How can you reach there?
    • Why you?

Competition

  • The deck
    • Who are your competitors?
    • How are they better?
    • How are you better?
    • Have a small table showing key differences
  • The narrative
    • No matter what - do not say you do not have competition - you will lose credibility
    • Demonstrate a clear advantage that you have
    • How can you be a market leader?
    • Bonus - if you have key insights into the business models of competitors

Go To Market

  • The deck
    • Customer acquisition strategy
    • How will you get your customers?
  • The narrative
    • Prioritize Short term over long term here
    • How can you grow in the coming 12-24 months?

Business model

  • The deck
    • How are you making money?
    • When will you reach breakeven?
  • The narrative
    • How is it going to work?
    • Go why and how behind the business

Projections

  • The deck
    • Simple operating plan that takes you from this round to next
    • What will you achieve?
    • What defines success?
  • The narrative
    • No plans work, but planning is everything

Fund raise plan

  • The deck
    • How much do you need to raise?
    • Fund utilization heads
  • The narrative
    • Explain the mechanics behind the fund raise
    • Why raise that money? Why now?
    • Where will this money take you?

Summary slide

  • The deck
    • Reiterate your one sentence pitch
    • What can you achieve in the next 24-36 months?
  • The narrative
    • Why?
    • Why you?
    • Why now?
    • Make the ask - you want to raise funds

Closing comments

In the next post, we will share how to take the next meeting, a product demo (if any), FAQs, handling investor questions, and final comments!

Pitching to Investors - Part I

In this new series of Pitching to Investors, we will share our views on an effectively framework for pitching. Despite widely available resources on pitching, we find that founders somehow always end up confused.

 

Pitching to Investors

What will we look to cover over this series:

  • A framework for pitching
  • Bringing context to a pitch
  • Finding a structure for the pitch
  • Share some tips on pitching

 

What is the objective of your pitch?

You used to walk up to the door of the fancy VC office with laptop in hand and freshly updated pitch loaded and ready to go. You now are Zooming your way in a pitching process. But at the end of the day, what are you hoping to accomplish?

Your primary objective of a pitch meeting should be to get the next meeting. You can use the pitch to:

  • Share relevant information that can arouse interest
  • Try to throw light on your business
  • Tell your story
  • Leave them wanting for more

But that's not it. You can also use the first meeting to establish your credibility and create the base for an on-going relationship. You can also use the meeting to seek and work on feedback and demonstrate that you are coach-able. And at the end of the day, you want to show them that you can be a fun or interesting person to work with!

 

Is it a sales pitch?

Yes and yes

Yes - Its a sales pitch but not for your product or service, but of your business

Yes - If your product succeeds, the company can create a lot of value and the investors can generate large returns

 

Do I need to be A+ during pitching?

The Indian startup ecosystem has become more 'American-ised' in its way of working. So its more about 'Sell me this pen in 30 seconds' coupled with smaller teams that run on low bandwidth and even shorter attention time spans. Having said that, an investor pitch is not a make it or break it for you. There are other resources available like:

  • Elevator pitch: A 30-90 second verbal communication that arouses interest
  • One pager: A one page document that contains relevant information packaged succinctly
  • Executive summary: A longer document which deep dives into certain points
  • Business plan: No plans work, but planning is everything!

At Malpani Ventures, we do not fuss over a pitch. In fact, we like if it can be a simple phone call where we can understand the background of the founding team and covers the following:

  • Why did you start? What was your hypothesis at that point?
  • Where have you reached today? How did you validate your hypothesis? What are the learnings?
  • Where do you wish to reach in 3-5 years? And How?

 

How can I be better at pitching?

At the end of the day, whether it is a pitch, or a sales call, or a job interview - some common themes remain the same. Having said that, here are some of our views:

  • Your business is the superhero. You are the narrator. Your deck is a supporting actor.
  • Do not read from your deck, let the slides support your overall narrative, and focus on telling your story
  • Do not try to educate people in the room, instead throw light on how you reached where you have
  • Practice different pitching scenarios - 1 on 1, 1 on many, 10 min pitch, 60 min pitch and so on..
  • Use different font sizes, images, visuals, graphs etc to attract attention
  • Keep a standard pitch, but use different variations (long vs short, high level vs deep dive, examples vs summary)
  • Your deck does not need full sentences, it just needs to convey your views
  • Be yourself!

 

In our next post on this series, we will share our views on a pitch deck structure! Stay tuned!

How can founders conduct better pitch meetings

It is vital for founders to conduct meetings seamlessly, control the flow, keep everyone a up-to-date, and drive towards the agenda at hand. Sometimes, it does become distracting when the flow strays from the agenda, or it starts becoming too technical which means some members start daydreaming about their lunch, or their next vacation. Don't you just hate it when that happens?

Whenever that happens, you can always fall upon some methods to quickly streamline the meeting and drive towards your goal.

How can founders conduct better meetings

a. Use Venn Diagrams

Why do we love the image of Ikigai? It just drives the point hard, and home!

Does not need elaborate explanations and time for people to understand. Visual representation is the easiest way to help draw attention. It does not matter if your diagram is correctly sized or accurate - it needs to invoke the mental capacities of everyone and make the meeting richer intellectually.

 

b. Do away with percentages, and use numbers

This is counter-intuitive, but hear us out. It is perfectly normal, and smarter to say "We have a 50% conversion rate". But think about it, we are so used to hearing percentages all the time. What if you say "We convert 1 out of every 2 users.... that means out of the 10 people sitting here, 5 of us can be buyers". This again ingnites the mental capacities of listeners.

 

c. Note down important points

Always have a notepad handy. You need not keep records as impeccable as minutes of the meeting. However any feedback, inputs, suggestions, changing body language, objections, questions need to be jotted down and revisited to understand why it happened, or how can you incorporate it to make your next meeting better.

 

d. Revisit some numbers or comments

It almost always helps if you can remember the context of a previous meeting, get everyone up-to-date, and then share a progress report. "If you remember when we last spoke you mentioned X, we've worked on it and I can confidently tell you that we have created 2X". This shows you pay attention, you work on inputs, and you know how to follow up. This, of course, only works if you actually did the hard work of following up!

 

e. Take a step back

Whenever you find the meeting going around in circles, politely request everyone to take a step back. It can be as simple as "Hang on, what are we trying to discuss - we want to find the best way to do X right? Can we discuss what defines success - and we can take it up from there". This prevents a meeting from straying, and people turning off after a point. Instead of that, you can take control, regroup, and work towards the goal in a time-bound manner. Nobody has 2 hours to spend discussing a point that was meaningless!

 

And there it is - simple methods to regain control of your pitch meeting and make it into a productive one for you and your team! If you have any suggestions, or personal experiences to share, please reach out to us. We'd love to hear from you!

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