VC Pitch Tips (reprinted with permission – from myself ;-)

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We talk a lot about messaging here, well in our day jobs as Venture Capitalists, investors are a key marketing target just like any other. A while ago we wrote a post on another blog (NW Venture Voice) translating some of the Playbook concepts into tips we have really seen work in making investment pitches. A bunch of folks asked us to repost, so here it is:

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The most important thing in having a successful pitch to a VC is to have a great business and a great team, but even if you have both it doesn’t hurt to have a super crisp, logical, compelling pitch. Here are 5 basic tips that I have seen really work.

1. Outline
First, have an outline. Be organized. The best top level outline I have heard it from one of the super masters of presentations, Jerry Weissman. Before you focus on all the snazzy charts, make sure you do the following:
• Tell them what you are going to tell them: Show them where you are going to take them, on the title slide.
• Tell them how you are going to tell them: Have an agenda slide and stick to it.
• Tell them: make sure the body of your presentation always reinforces your opening point.
• Tell them what you told them: wrap up, recap and go for the close.

2. In a nutshell
One great tool for making this organization stick is what I call the “in a nutshell” slide. This is using your agenda slide to tell the skeleton of your whole argument. When presenting to Steve Ballmer it often happened that you never got off the first slide after the title, so make sure it really works for you.

Normally, I like to see In A Nutshell slides that act as a template. On one side they highlight, even number the key elements of your story/pitch/argument and in parallel on the other side they give the top support points in summary. As you then move through the deck you keep the left hand template to reinforce the whole argument and help people remember where you are in it.

3. Clear, simple case
Show why your company/investment should exist in the first place. Do the simple case using what we call yourABCs or situation/gap analysis. Where:
• A = Today: the current situation in the market/big growing
• B = Tomorrow: the place the market should be/juicy opportunity
• C = Gap: what’s missing to get to B/the special play you are poised to make to fill it and win

4. Simple positioning and proposal
Then tell why your way of filling this gap is better than everyone else’s. One simple outline for this is what we call the XYZs – “We are the only X company/product that solves Y customer problem in Z unique way,” where
• X = your category: critical for VCs, we need to put you in some box, to make comparisons; never invent a category, improve one.
• Y = the target: the buyer, the person who actually writes the check, great if you actually have some.
• Z = your differentiation: your advantage, or the key positive distinction you have over your competition.
It also helps if you can back all this up with real support, like your team’s track record, customer traction, a real competitive analysis (their ABCs), etc. A demo is not enough. Proof is better than claims.

5. Best foot forward first and strongest
Tune the organization of your story to the stage of your company. And always put the strongest stuff upfront.
• An EIR: It’s all about YOU and the market opportunity/competitive gap.
• A seed: It’s all about initial market validation (quotes from friends with important job titles in your target customer’s industry), then about the product spec, the team and the above.
• A round: It’s all about initial customer traction and economics – some demonstrated willingness to try and pay – show the best real numbers you have, then about the product itself relative to others, then the above/
• B round: It’s about momentum – show the sales numbers, the trends and the economics, then all the above.
Then of course have a well thought out and aggressive enough ask.

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Here are some other resources and inputs on VC pitches:

  • Cliff Atkinson’s Beyond Bullets. Very nice stuff on how to have the maximum impact with PPT.
  • Brad Feld with a wide set of thoughts on The Torturous World of Powerpoint and 15 questions you need to ask in making the pitch
  • Marc Hedlund with a pretty funny powerpoint on VC funding for geeks (also has some good insights about not needing money as the best way to get it, and how raising money really is a full time job)
  • A VC referring to an interesting/funny elevator pitch podcast by Eric Lunt, CTO of FeedBurner
  • More on podcast pitches from David Hornik
  • Startup Law Blog referall to a Businessweek article on the topic by Allen Morgan
  • Allens more complete thoughts on this, especially commandments 456 and 7, emphasizing the importance analogy, no more than 13 slides, and knowing the audience
  • Seth Levine with some excellent does and don’ts that sound basic but so few seem to follow, and
  • Nick Morgan with a bunch of guidance of how to grab your audience’s attention and tell them an emotional story.

Note: Cartoon courtesy of Les Posen’s CyberPsych blog