Virtually all of today’s most promising startups started with a pitch. For this reason, budding entrepreneurs need to master the art of the pitch early in their careers and learn how to tailor it according to the audience.
Nicole Junkermann
Because entrepreneurs are often passionate about their ideas, they may find it relatively easy to deliver a pitch. However, passion alone will not get you far. Angel investors and venture capitalists likely hear pitches all the time, so it’s important to go above and beyond and grab their attention with a truly great pitch. Often, moving from good to great involves making only a few small modifications—and perhaps adding some emotional elements. Some tips to keep in mind about giving a truly great pitch include the following:
1. Show the product.
Too often, entrepreneurs pitch a product and spend a lot of time describing it instead of showing it. The best way to hook investors is to give them a sneak peek of the product. While showing the product may not always be possible, you should think of other ways to get your ideas across, whether that is through photos, mock-ups, or a digital presentation.
Visual representations will save you a lot of words and ultimately make the pitch more memorable. Investors are not likely to remember the picture they created in their heads of the product, but they may recall the actual thing, especially if they found it impressive.
2. Simplify the pitch.
You, just like other entrepreneurs, have likely put hundreds of hours into the idea that you are pitching to investors. For that reason, you may lapse into business jargon or technical language that investors may not understand. Investors may not have the technical or industry expertise to follow along in a pitch for a complicated product or service.
Also, to sell your product or service to the layperson, you will ultimately need to simplify it, so you should focus on creating an explanation that anyone can understand. Practice the pitch on someone who has no reference points for the product. If that person gets confused, then the pitch needs to be simplified.
3. Tell a real story.
Entrepreneurs often struggle with how to open a pitch. Luckily, you do not have to reinvent the wheel when it comes to pitching the product. A great way to get people interested is to tell a real customer story. The story should be short, focus on a problem, and show how the startup addressed the issue. Ideally, you will avoid buzzwords and stereotypes with the story. The narrative should speak for itself and be relatable. A reason to open with a story is that people tend to remember narratives better than facts. If an investor remembers the story, they will also remember the product.
4. Talk about people.
While entrepreneurs tend to think they are presenting a product with a pitch, they are really selling themselves. Investors tend to put their money in people rather than ideas. You need to sell yourself and your team during the pitch. Discuss your accomplishments and how they have prepared you to lead this new company. If a team already exists, the pitch should also include the accomplishments of your team members. Investors should know why those people were chosen and how their guidance can lead the startup to success. Importantly, you should focus on recent accomplishments, especially those achieved at the startup, not just prior projects.
5. Address the competition.
If you say your product doesn’t have any competition, you will quickly lose the attention of the investor. Everyone has competition, and saying the opposite just means you have not put enough research into it.
Even if you don’t have direct competition, there is always indirect competition. A great pitch explains what competition exists and how the company’s product is different. Does it appeal to a different market or gain a strategic advantage over other companies?
This part of the pitch shows investors that you are thinking critically about the barriers to success and being both strategic and systematic about how they will get addressed.
6. Outline the business model.
You may feel like a business model is a boring detail that could detract from the pitch. However, a business model shows how an idea actually generates income—and investors will want to know about it. A great business model proves the economic viability of the idea. In practice, the business model should be reduced to a few basic bullet points. You do not need to get into the fine details, but investors should have a clear idea of how the company will generate money.
Investors want to know that you have done the necessary due diligence. Also, they are likely to ask questions about the business model, so addressing the basics up front allows them to ask more specific questions later—and you can show off how thoroughly you’ve researched it.
