The product you've built, the team you've assembled, the customers you've won, the growth you're predicting - all crucial for winning investor support. And you can have all those pieces in place and still blow it during your pitch. This can happen because of your demeanor or something you say.
"Startup killers" is how Cynthia Kocialski describes them. "When speaking to someone about the new product or the business proposition, there is often the moment when you know that you have lost your listener," she writes in a blog post titled "How to Lose an Investor Before You Finish Speaking." "One misspoken comment and everyone wants to leave as soon as possible. They've made their decision and they want you to stop wasting their time."
Kocialski lists these "turn-offs," including:
- Investors' Money Getting No Respect. Kocialski gives the example of two co-founders who, when asked by a potential angel investor what their plans would be if the startup encountered some problems, replied that they'd just go back to their old jobs.
- Zooming In On the Exit. You should demonstrate that you're concerned with building the company, not just selling it down the road.
- Big Market Numbers. Be wary of sweeping statements about how "everyone in the world could use our product."
- No Competition. There is always competition, because somehow customers are fulfilling that need today. Although you do want to stress a young and growing market, says Kocialski, you do want one that's proven.
- Being Too Eager to Abdicate the Throne. Kocialski describes this as when "the founder is the CEO, but doesn't want the CEO's job and wants to find a replacement. There's a difference between succession planning and abdication."
- No Customer Input.
- Appearing Non-Coachable. An investor provides advise, as well as funding. So if an entrepreneur appears to not listen and not address investor questions, that's definitely a "startup killer." Every time an investor or customers asks a question, they are impacting valuable information. Not listening or addressing their concerns is a start-up killer. Kocialski cautions against entrepreneurs getting defensive when investors ask probing questions, as signs that te entrepreneur doesn't have skills to build an effective team or to recognize and adapt to change.
Attitude and demeanor can't be stressed enough, as David Lerner noted following a recent pitch competition event where presenters started "royally pissing off a few of the judges." Lerner offered the following (slightly tongue-in-cheek) tips on "How Not To Piss People Off When You Present to Them."
- Don't start all your responses to questions with the word "So."
- Don't say "that's a good question" back to the person who asked you the question.
- Don't put people on stage during the presentation if they have nothing to say.
- If you are asked a question, don't bob and weave. Either answer it, or say that you don't know the answer and will get back to them later.
- If you don't wear a tie every day, don't wear one just for a pitch event. Be authentic.
As Lerner and Kocialski contend, you can have a great product and a great PowerPoint, but you do need to be mindful that your pitch itself doesn't alienate investors.
For more advice, see our other ReadWriteStart coverage on pitching.