How to Pitch a VC

2014/2/26

Today’s business climate revolves around innovation and new product development, so entrepreneurs increasingly need support from venture capitalists. The individual entrepreneur’s problem is determining how to stand out in a sea of other impassioned visionaries.

The flipside of the growth in entrepreneurship is an unprecedented increase in the competition for funding. So, to catch a VC’s attention you need more than just a good idea. But how do you hook and reel in bankers and other investors, and convince them in to fund your venture when the competition is so steep? Your edge may simply come down to your pitch. Its content and its delivery may matter even more than your product or service itself.

Lessons Learned: How to pitch a VC, tips from Guy Kawasaki and David S. Rose

Of course, a strong “advanced elevator pitch” requires a working prototype and a strong presentation,” but what else do you need?

First, make sure your PowerPoint presentation follows author Guy Kawasaki’s oft-quoted 10/20/30 rule? (that is, 10 slides, lasting no more than 20 minutes, and containing no font smaller than 30 points.)

To get the scoop on pitching to VC’s, we turned to two well-regarded speakers, both leading authorities on gaining start-up funding. Kawasaki himself and David S. Rose, who offer their top tips on pitching a VC:

David S. Rose

BusinessWeek calls David S. Rose a “world conquering entrepreneur;” he calls himself the “pitch coach.” He’s an investor who has raised millions in venture capital and invested millions in more than 75 pioneering tech start-ups. His top tips on how to pitch venture capitalists successfully include:

Top Tip # 1: Entrepreneurs themselves are the most important aspect of any business investment. They must display as many of the following characteristics as possible: integrity, enthusiasm, experience, expertise, skillfulness, leadership, commitment, vision, realism, and willingness to learn.

Top Tip #2: Your presentation must take the audience on an emotional journey, loop them in and engage with a sense of personal connection and excitement about the product or service you are hoping to fund.

Top Tip #3: Begin dramatically, make your case logically, and end powerfully.

Top Tip #4: Lend your product or service credibility by using “touchstones” (reference to well-known firms) and “validators” (information that supports your claim).

Guy Kawasaki

This Silicon Valley-based author, speaker, investor and business advisor founded garage.com in 1998, as a seed capital and early-stage venture capital fund for start-up technology-based companies. In 2004, he wrote “The Art of the Start” a reference book for entrepreneurs looking to raise capital. He is a leader in venture capitalism, so take his advice to avoid making the most common mistakes:

Top Tip #1: Bankers have heard plenty of pitches before yours and they will hear many more. Stand out! Start smart, tell a good story that stirs emotions and creates an attachment, and make a strong statement.

Top Tip #2: Avoid clichéd, over-used adjectives. VCs have heard all about revolutionary, patent-pending apps a hundred times. Ditto the innovative vacuum cleaner.

Top Tip #3: The proof is in the pudding. Use figures and facts to back up your claims and build credibility. For example, demonstrate that you are already making $20,000 a day and acquiring 2,000 new users per month. Make sure the numbers add up!

Top Tip #4: Does your product or service solve a problem or present an opportunity for its consumers? The VCs want to hear about it. Integrate their feedback about your pitch into your commentary to make your position even stronger. Remember: VCs are not your friends. They are in it for the money. As are you.

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