7 Investor Presentation Pitfalls

Silicon Valley venture capitalists dish the dirt on the biggest blunders you could make during a presentation to investors.

"Yes!" I shouted, pumping my fist Tiger Woods-style as I read the e-mail. The managing director of a new Atlanta-based incubator had replied to our executive summary submission for our start-up, PRessCafe.com, an online hub for emerging technology companies and the media. His message: "I'm interested in meeting to discuss your business. How about Thursday at 2 p.m.?" Many aspiring entrepreneurs never make it this far-a face-to-face meeting with a "live" investor. And we did it!

Being 27 years old, married with two young daughters, and having drained our savings and maxed out our credit cards to pay the bills, this was especially welcome news for my wife and me. We began daydreaming about the future: Where would we live? How big would our house be? What cars would we drive? What private school could we send our kids to?

But when it was time for me to present, along with our COO, I froze. The investor began the meeting with this: "Tell me, in two sentences or less, why your company must exist." This threw me off in relation to the "canned" pitch I had prepared. I blanked. To break the silence, I started to recite, verbatim, the first paragraph of our executive summary (which, of course, he had already read), and it became clear I wasn't answering the question to his satisfaction. With each follow-up question, I felt more and more intimidated-and frustrated. I could sense our COO's feeling of helplessness as she watched me stammer through the presentation. At the end of the hour, the investor concluded that while we had a seedling of a business, we had a ton of work to do to succeed in attracting outside capital.

I felt dejected and embarrassed, dreading the thought of telling my wife. How would I break the news to her? How would she respond? At the same time, I was concerned about my partners. Would they lose faith in the business.and me? How could I regain their confidence? That evening was one of my darkest. Three months later, however, through our passion to succeed, we were able to convince that same investor to give us a second chance. And we nailed the presentation, having incorporated many of the suggestions he'd given us at that first meeting. This person has since joined our advisory board and has been our leading advocate in opening additional investor doors for us in the Atlanta area.

But second chances are rare. Often, when you bomb with one investor, word spreads quickly to the others. So how do you make the most of your investor presentation opportunities? We've interviewed three top Silicon Valley venture capitalists who can help you stay away from the following seven "deadly sins.".

Sean M. Lyden is the CEO of Atlanta-based PRessCafe.com. He has since landed his first significant outside investment, largely as a result of steering clear of these seven deadly sins.

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Sean Lyden is the CEO of Prestige Positioning (a service of The Professional Writing Firm Inc.), an Atlanta-based firm that "positions" clients as leading experts in their field-through ghost-written articles and books for publication. Clients include Morgan Stanley, IFG Securities, SunTrust Service Corp. and several professional advisory and management consulting firms nationwide.

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This article was originally published in the February 2001 print edition of Entrepreneur with the headline: 7 Investor Presentation Pitfalls.

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