From First Impressions To the First Fund-Raise Are you pitching how you have used the pandemic to build, learn, and survive?
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These are challenging times. Startup founders are dealing with reduced demand and depleting cash reserves as customers re-evaluate their purchase decisions, or simply defer them. A recent TiE Delhi/Zinnov report states that due to COVID-19, 15 per cent of startups have halted operations while 44 per cent have cash runway for less than six months. It has been a specially difficult time for startups who were about to commence their fund-raising phase just as the pandemic hit.
As startups' focus shifts to issues of survival and cautious growth, they need to modify their fund-raising strategies. The competition for angel and venture capital has only increased. The downturn has resulted in extended funding decision cycles and a general squeeze on funds. As the narrative shifts back to the fundamentals of building robust and viable ventures, and attention spans on Zoom calls diminish, it becomes even more essential to pique investors' interest as early as possible.
Some learnings to make a stellar (virtual) pitch that takes you closer to your fund-raise.
Founders' personal story
The potential of a business is greatly dependent on the founders and hence, investors care a lot about the background of the founder(s). While it is imperative to describe your motivation for choosing to work in a specific domain/sector, it is equally important to present (in short!) any personal reasons for doing so. Investors want to hear how the founders will translate their knowledge and passion into a game-changing venture. Past incidents reflecting fortitude, strength, innovation, and character is of immense relevance to someone who is looking to invest in you and your ideas. Of special interest would also be an account of how you have used the pandemic to build, learn, and survive.
While the language used during a pitch session is irrelevant, it is often a window into the founders' minds. Investors pay close attention to how phrases like "I vs. us", "product vs. customer experience", "money vs a world-changing-idea" are used. It is not an elitist statement on the choice of one language over another during a pitch; rather it is about how well-tuned are the founders to being coached, collaborating with others, and thinking outside-in. You can kill a winning pitch by using the wrong words to convey the opposite to what your intent is.
Clear and succinct messages
It is stated that the hallmark of a sharp mind is to convey the essence of any topic in as few words as possible. As a founder, think ahead of the objectives of your pitch, pre-select the key messages and convey them with brevity. Your confidence during an investor pitch inspires confidence in the investors that you will be as effective in front of customers, partners and new hires. Online audiences have a rather short attention span—make your time count.
Powerful points are more important than PowerPoint
Do not confuse a great pitch deck with a great pitch. Use the pitch deck as a tool to convey your message—and not the message itself. Make sure that your slides are not crowded with details that overwhelm the audience, or worse, bore them. Align the deck with your personal journey, business narrative and individual style. Use images as much to convey messages as to provide a visual break to the most-likely jaded audience.
Your pitch must evoke the following sentiment at the investor's end at the end of the pitch: "This is an interesting team working on an exciting idea; let's learn more." Despite what appears on shows like Shark Tank, funding decisions are rarely made on-the-spot. A follow-on meeting is needed to taking things forward; a meeting for which you must prepare even harder. Make sure you know your market, competitors, and financials, and you will surely be asked about your ability to execute under extreme pressure. It is always good to walk into these follow-on discussions with a clear list of your current and potential customers, along with their testimonials if available.
In these challenging times, sharpen your ability to make great Zoom pitches. But more importantly, re-think your business model, adjust the value proposition, and re-strategize your growth plans as you invite others to partner for an exciting future.