startup weekend brussels 2014 - how to pitch - bruno wattenbergh

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What is a pitch ?

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A short presentation …

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Dedicated to one or a limiter number of person …

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An entrepreneur pitch all the time …

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2.

What are the purposeS

of the pitch ?

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Try to convince somebody you know to do something very specific …

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You are supposed to know the person … the pitch is supposed to be adapted to this person …

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You know the result immediately …

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Purposes of the pitch internal ?

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3.

Does it makes the difference ?

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Does it makes the difference ? YES ! (The Impact of Entrepreneurs’ Investor Forum Pitch Presentation Skills on Business Angels’ Initial Screening Investment Decisions by Colin Clark - Marketing Department, Burgundy School of Business - École Supérieure de Commerce de Dijon-Bourgogne, BP 50608 – 21006 Dijon cedex France)

The business angels’ post-presentation level of investor interest was significantly related to their evaluations of the quality and content of the entrepreneurs’ presentations: The higher an entrepreneur’s overall presentation score, the greater the likelihood that the business angels would be interested in pursuing that entrepreneur’s investment opportunity. Presentational factors also tended to have the highest level of influence on both the overall score an entrepreneur received as well as on business angels’ level of investor interest. However, the business angels appeared to be unaware of or were reluctant to acknowledge the influence presentational factors had on their investment-related decisions: The reasons they cited for their post- presentation intentions were focused firmly on non-presentational criteria. More generally, however, comments about the entrepreneurs’ presentations centred on presentational issues relating to clarity/understandability and structure, the level of information that was provided, the personal characteristics of the entrepreneur, and the entrepreneurs’ ability to sell themselves and their investment opportunity.

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To sell something or to attract finance ?

• Both … !

• Almost the same structure … !

• Not exactly the same composition / objective ...

• The same introduction hook

• The same conclusion appointment !

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To pitch : what does this mean ?

• To tell a story to convince somebody to do something …

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Facts vs. Stories strategy

• Stories, on the other hand, encapsulate information, knowledge, context and emotion into one compact package.

• This is a right brain activity.

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Outcome of a successful pitch ?

• Prepare the next stage appointment On – Off (good control !)

• Create in the mind of the interlocutor a positive mindset for future actions / success !

• Avoid useless appointments are you in the range ($), scope (sector, stage, …) of the investor … or for a sale pitch do we have some potential interest to make business together ?

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Duration of the Pitch ?

• 2 minutes ?• 4 minutes ?• 10 minutes ?• Q&A ?

• Depends on the stage of the relationship … ?• Depends on the country … ?• Depends on the place … ?

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8 key steps to succeed your (elevator) pitch ?

8 key sentences !

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1st STEP : “A good Hook”

Ask a closed question Known answer ! Clear customer pain Data ?

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1st STEP : “A good Hook”

Get connected - Attract attention

Highlight the problem, pain, need that your enterprise wants to solve or meet make it clear, obvious.

Your interlocutor will project himself in the problem and be ready to understand the value of your proposition

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2nd STEP : “Your SOLUTION”

« The SOLUTION ! »

How you can solve this very specirfic customer pain ?

A G.O.U.S.P

PPASX ?

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2nd STEP : “Your SOLUTION”

What is your product, service description based on the pain highlighted in the hook.

Describe briefly what exactly you’ll sell risk / value

No technical details !

The value must be understood Quantify ?

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3rd STEP : “Who’s your Customer”

« The chosen Customer ! »

Market vertical chosen !

Select and describe a vertical … and explain why !

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3rd STEP : “Who’s your Customer”

Who will be your customers ?

What is their activity sector or industy ?

Some indications on the market size

Known market – if possible – a market test

If possible show letters of intent

4th STEP : “Where is the $$$$$$$$”« How will you make

money ? »

Business Model ?

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Briefly describe the business model chosen

How will you deliver the value to the customer ?

How will you capture the value from the customer ?

Recurrent revenue channel ?

Distribution, Sales, Test-case, … ?

5th STEP : “Who are you ?”« You & your team ? »

Explain who you are …Expertise

Complementary team

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A lonely wolf … or a team ? An inventor, a manager, entrepreneur ? Track records Explain why you and your team are capable of solving the

announced problem and why you deserve to be paid for that ?

6th STEP : “Comparative Advantage ?”« What is you U.C.A.? »

Explain why you are ≠Explain why it is a competitive advantage

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You not a dreamer … you know what your are talking about … you know the value for the customer

You know the customer & the competition Metrics ?

Take the angle of talking about the comparative assets of your project, how you distinguish yourself from the existing competition : distribution, partnership, technology, …

7th STEP : “Competition?”« Who are the Competitors ? »

It there are competitors … great ! … There is a market !

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What are your main competitors (very figurative for the investor) ? Why ? What is their market share ?

Competition is a good thing. It means there is a market!

Metrics

8th STEP : “Closing”« Follow-up Action ? »

Goal of the pitch is to induce a follow-up !

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Explain what you expect from your interlocutor …

What is the next step for you ?

How to induce a follow-up concretely ?

A pitch is NOT …

• A technical description of your product or technology …

• A childish attempt to persuade …

• A process of seduction …

• An abstract thing …

• Is rather convincing than persuasive respect

• …

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Some key interdependencies with the BP ?1. Customer Pain

2. Value proposition

3. Quantifying value proposition

4. Decision making unit (DMU)

5. Identification of targets (market vertical)

6. Finance

7. Pitch and … or BP ?

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The Fault ?

You’ll head of a crash if … ?

1. Talk about technology

2. Talk about yourself

3. Lack empathy

4. Do not prepare enough

5. Don’t know the interlocutor

6. Waste time disrespectful

7. Lack of confidence

8. Fishing expedition

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Fault 1 : Too much Technology ?

☹ Don’t talk too much about technology

☹ Technology is not a the means to an end !

☹ Technology is a way to create value

☹ We are talking about a venture, not a research project

Mention technology once but be ready to answer question or to offer a demo

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Fault 2 : Talking about yourself ?

☹Don’t talk about yourself all the time

☹Pitch must be focused on them, not on you

☹Dialogue must be focused on their interest for the venture

You = Team + stock of competencies and skills, stock of experience, …

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Fault 3 : Lack of Empathy ?

☹Don’t be self-centered

☹Investors & clients do business with people they have a relation with … People think they have such a relation when they feel they are understood (need, situation, pro / private / CP)

☹Listen and keep your concentration on their questions ?

☹Too much preparation on the form (2muchtraining) ?

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Fault 4 : Lack of preparation ?

☹ Vague … no logic … no red line

☹ Lack of knowledge about the product, … or the customer pain

☹ Unable to play with the VP

☹ Don’t know the target or less knowledge of the market than the target

☹ No BM

☹ Basic questions without answer

☹ Nothing to ask

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Fault 5 : Don’t know the target ?

☹Lack of respect

☹Lack of preparation

☹Unable to adapt the Customer Pain

☹Impossible to know what to ask

☹…

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Fault 6 : Too long ?

☹Lack of respect

☹Lack of empathy

☹Lack of preparation

☹Unclear Value creation and/or Business model too complex

☹…

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Fault 7 : Lack of confidence ?

☹Lack of preparation ?

☹Lack of knowledge of the market ?

☹Weak BM …

☹Don’t know what you want ?

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Fault 8 : Fishing expedition ?

☹No clear objectives

☹Nothing to ask

☹Don’t do that with Mr BIG !

☹Change you training program !

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Watch the technical problem !!!!!

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Prezi ?

What to do if my model is complex ?

Try to use mind mapping

Tell a nice interesting story

Think about the media tools

…

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6 principles to let your pitch « stick »

• SUCCES– S imple– U nexpected– C oncrete– C credible– E motional– S tories

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One book to buy …

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I have only made this letter rather long because I have not had time to make it

shorter.

Blaise Pascal

Somes movies ?The classical video on Elevator Pitch (380.000 views) :

http://www.youtube.com/watch?v=Tq0tan49rmc

Some examples + feed-back from judges

http://www.youtube.com/watch?v=vAvErchnM_w

A finalist at the 100K$ BP Competition at MIT

Http://www.Youtube.Com/watch?V=-ddsp71oino&feature=related

10 things to know when you pitch a VC – HBR

http://www.youtube.com/watch?v=lzDBrMisLm0&playnext=1&list=PL836838DACEB39198

Some good advices …

http://www.youtube.com/watch?v=q0EWScOXFpA&playnext=1&list=PLFC6C881B6B313D64

Some students pitching

http://www.youtube.com/watch?v=Bh5TA6S4X24&feature=related

http://www.slideshare.net/bizbooktalk/made-to-stick

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Some books ?• Elevator Pitch Essentials: How to

Get Your Point Across in Two Minutes or Less The 9C’s

• The Art of the Start: The Time-Tested, Battle-Hardened Guide for Anyone Starting Anything

• Made to stick or the Art of making ideas unforgettable !

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Reminder : Some key interdependencies ?

1. Customer Pain

2. Value proposition

3. Quantifying value proposition

4. Decision making unit (DMU)

5. Identification of targets (market vertical)

6. Finance

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1. Customer Pain ?

Notion of customer pain

Identifying current pain

Developing latent pain

Quantifying the pain

Understand needs, situation, vision, constraints, …

Create relationship when you sell

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1. Customer Pain (2) ?

Market segmentation indispensable

Choose a vertical market subset

In relation to your offer (resources & competencies)

In relation to the market interest (customer pain, tendency, wave, …)

Do some questioning

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2. Value Proposition ?• A value proposition is generally a clear and succinct statement (e.g., 2-4

sentences) that outlines to potential clients and stakeholders a company's (or individual's or group's) unique value-creating features.

• A value proposition is a clear statement of the tangible results a customer gets from using your products or services.

• A value proposition is an offer to some entity or target in which they (the possessor) get more than they give up (merit or utility), as perceived by them.

• A value proposition is the basic reasoning for why people should consider your product or service.

• Describes what you do in terms of tangible business results. It draws interest and shares a success story within a few words.

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2. Value Proposition (2) ?

Some questions / issues about the VP ?

P.P.A.S.X. ?

Product / service / Levitt ?

Business model ?

Pay attention to Swiss knife syndrome !

Make choices !!!!!

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2. Value Proposition (3) ?

P.P.A.S.X. ?

Product characteristics ?

Price more than costs only strategy ?

Access distribution PoC with client / CR ?

Service Levitt / whole product ?

eXperience feelings, emotions ?

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2. Value Proposition (4) ?

The challenge of the Value Proposition ?

Identify & compose the characteristics …

… identified clients are ready to pay for …

… with a clear differentiation …

… while making a minimum / maximum profit …

… being able to present it attractively / value

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2. Value Proposition (5) ?

USP Unique Selling Proposition ?

One value that distinguishes your from others

One value that lets you dominate the offer

The other values must meet the standards of the competition

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2. Value Proposition (6)Value proposition can be synthetized …

–Domino’s Pizza : Fresh, hot pizza delivered to your door in 30 minutes or less, or it’s free–FedEx : When your package absolutely, positively has to get there overnight–IBM : Global solutions for a small planet–Intel : Intel inside–Lexus : Passionate pursuit of perfection–Visa : It is everywhere you want to be–M&M’s : the milk chocolate melts in your mouth, not in your hand

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2. Value Proposition (7) ?

Test you VP 4C’s check :

Consistent / Logical / Durable

Concise

Clear

Credible

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2. Value Proposition (8) ?

How to look for a VP ? :

Step 1: Use your biggest benefits

Step 2: Be unique

Step 3: Solve an industry “pain point” or “performance gap”

Step 4: Be specific and offer proof

Step 5: Condense into one clear and concise sentence

Step 6: Integrate your USP into all marketing materials

Step 7: Deliver on your USP’s promise

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3. Quantify the Value Proposition (1) ?

Value Proposition must be quantified ?

Measure clearly the economic & social benefits

Move from burden / cost to return on investment

Imposes to know the client weel Study / prepare

Ideally a well documented test case

Ideally you need to focus on a specific vertical market Focus

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3. Quantify the Value Proposition (2) ?

Get into your client’s mind

Try to understand how your client currently solves his problem

Assess the impact of your value proposition on his processes

Calculate – Estimate the change you need to give a good return on investment

Be better, faster, cheaper !

Pay attention to NIH

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3. Quantify the Value Proposition (3) ?

NIH : In-house competition is a trap you need to manage

Be capable of evaluating the option of in-house development rather than evaluating your value proposition

Economic redemption

Learning and scale curves

Maintenance

Synergies

…

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3. Quantify the Value Proposition (4) ?

How to fix prices ?

Cost + hmmm, not so good

Vs competition not so good

Rather a benefit for the client good

Ideally : integrated approach of all these options

Be creative

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4. Decision Maker Unit – DMU ?

Who will you pitch to sell ? Why ?

You might have some choices ? Do you ?

Choose the good / right interlocutor regarding your quantified value proposal …

The pitch must fit the DMU …

Prepare, prepare (identification, quantification, …)

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5. Decision Maker Unit – DMU (2) ?

Focus on ONE market subset

Startup lack of resources (time, money, …)

Credibility <-> capacities

Need to validate the BM quickly

Know a vertical market very well, test your VP quickly, adapt your VP, test again, validate, explain, scale up

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Some basics to remind ?