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Business Plan - Presentation Format“The Pitch”

Business Plan SessionMary Kilfoil and Shelley Hessian July 18, 2011

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1. Know what you are looking for

• introductory “on the radar” meeting?• feedback? support? connections?• access to program funding?• consideration for a debt-oriented investment?• consideration for an equity-oriented investment?

Are you ready for the audience?

The Pitch - Context

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2. Know your audience

• government economic dev’t program manager?• customer? partner? other?• angel investor? angel network?• early - mid - late stage institutional investor?• industry sector, business model, geographic focus?

Specific audiences will expect more or less emphasis on specific information.You must predetermine and tailor your pitch to the audience.

The Pitch - Audience

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3. Know your stuff

Demonstrate you have deep knowledge of:

• target customer, target market metrics• business model• go-to-market strategy & ability to execute• competitive - alternative landscape• how will you use the funds?

Ensure you are listening to objections & feedback. Be passionate objective and balanced while defending your position

The Pitch - Readiness

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4. Storyboard your pitch

Based on your knowledge of the “audience”:

• identify the key messages (1 - 3)• primary spokesperson, back up team• plan for 20-minute pitch (6 – 8 slides) • expect, even encourage “robust” Q&A • opinions form very quickly

A pitch is not intended to cover every detail. Leave them wanting more.A compelling pitch will result in follow up meeting(s)

The Pitch - Storyboard

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Title – Intro(1 min)

Market Problem&/or Opportunity(2 min)

Addressable MarketSize, Growth Rate(2 min)

Value PropositionDemo, Claim(4 min)

Primary Business Model(3 min)

Go-to-market Strategy(3 min)

Team: current, Planned / ability to execute(2 min)

Current status:12-24 month Key milestones(3 min)

High LevelFinancials: QtrlyExpense/Revenue(backup slide)

ObjectiveAlternateLandscape (backup slide)

The Presentation - storyboard example

Barrier to Competitive entry(backup slide)

Funds required: use Of funds(backup slide)

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• 10 Slides

• 20 Minutes

• Minimum 24 Point Font

Tip – The 10/20/30 Rule

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• Explain yourself in the first minute

• 3 key messages

• Understand “so what”

• Know the audience

Tips

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Innovacorp – Example of 3 key messages

Innovacorp helps early stage Nova Scotia companies commercialize their technologies for export markets.

Our High Performance Incubation (HPiTM) model fosters innovation and entrepreneurial success

We focus on three areas to help early stage companies succeed: incubation, mentoring, and investment

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• Set the stage• Timing (20 minutes)• Number of slides (10)• Q&A (10 minutes)

• Get to a relatively high level and stay there

• Check in with the audience to make sure “they’re with you”

Tips

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1. Title 2. Problem 3. Solution 4. Business Model

5. Underlying Magic

6. Marketing & Sales 7. Competition 8. Management

Team

9. Financial Projections

10. Current Status

The Presentation Outline

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• Use a simple (white or light) background• Add your logo to every slide (via master slide)• Use common fonts (Arial works)• Do NOT use animation or sound effects• Build slides only when necessary ie: by bullet• Limit the use of sub-bullets• Bullets lead ~ so don’t read• Add diagrams and graphs• Make printable slides (avoid dark back grounds)• Have back-up content slides ready

Tip – PowerPoint

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• Organization name• Presenter name and title• Date

1. Title

1. Title

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• The audience can read the slide so this is where you explain what your organization does.

“We sell software”“We sell hardware” “We design medical devices”

1. Title - tip

1. Title

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• What’s the pain

• Describe it in detail

• Make sure audience understands

• Get agreement

2. Problem

2. Problem

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• Avoid looking like a solution searching for a problem.

• Minimize or eliminate citations of consulting studies about the future size of your market.

• Share how your personal experience with the problem or target customer leads you to believe…

2. Problem - tip

2. Problem

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• How does solution alleviate pain

• How significant is the solution

• Clearly articulate what your selling

• Value proposition

3. Solution

3. Solution

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• This is not the place for an in-depth technical explanation. Provide just the jist of how you fix the pain.

“We are a discount travel website. We have written software that searches all other travel sites and collates their price quotes into one report.”

3. Solution - tip

3. Solution

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• Who are the primary and secondary

customers?

• What are the channels to market?

• How you make money?

• Gross margin?

4. Business Model4. Business Model

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• Generally, a unique, untested business model is a scary proposition. If you truly have a revolutionary business model, explain it in terms of familiar ones.

• This is the opportunity to drop the names of organizations that are already using your product or service.

4. Business Model - tip4. Business Model

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• Describe the technology

• What’s unique – proprietary ?

•Patentable ?

• Barrier to entry for competitors

•Ease of duplication What are the channels to market?

5. Underlying Magic5. Underlying magic

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• The less text and the more diagrams, schematics, and flowcharts on this slide, the better.

• White papers and objective proofs of concepts are helpful here.

5. Underlying Magic - tip5. Underlying magic

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• Go-to-market strategy

• What does a customer look like

• How will you reach your customers

• Product positioning – price vs. value

• Sales cycle

• Channel(s) to market

6. Marketing & Sales6. Marketing/Sales

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• Convince your audience that you have an effective “go-to-market” strategy that won’t break the bank.

• This is extremely important and is usually very poorly thought-out.

6. Marketing & Sales - tip6. Marketing/Sales

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• Complete competitive overview

• Who and where ?

• Comparison to your solution

• Price vs. value

• Features & benefits

7. Competition

7. Competition

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• Never dismiss your competition.

• Never think that you have no competition.(competition = customer’s alternatives)

• Never underestimate your competition.

• Everyone (customers, investors, employees), – want to hear why you’re good, not why your competition is bad.

• Great spot to use a graph/chart/diagram

7. Competition - tip

7. Competition

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• Management team key players

• Board of Directors

• Advisory Board

• Subject matter advisors

• Major investors.

8. Management Team8. Managementteam

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How do the people on the team help with the problem, solution, business model, marketing & sales, competition

Don’t be afraid to show-up with less than a perfect team.

All start-ups have holes in their team.

What’s truly important is whether you understand that there are holes and are willing to fix them.

8. Management Team - tip8. Managementteam

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• Three year forecast• First 18 months important• Cash flow • Income statement• Balance sheet• Key metrics• Number and profile of customers

9. Financial Projections9. Financial projections

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• Do a bottom-up forecast.

• Take into account long sales cycles and seasonality.

• Making people understand the underlying assumptions of your forecast is as important as the numbers you’ve fabricated.

• Stay high level (revenue, expenses, margin, headcount) but be able to go deep.

9. Financial Projections - tip9. Financial projections

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• Status of development?• Near future (0 to 6 months)?• Use of funds ?• Expected leverage of funds• Timelines with past accomplishments• Future milestones First 18 months important• Cash flow • Income statement

B l h t

10. Current Status10. Current status

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Share the details of your positive momentum and traction, then use this slide to close with abias toward action

Reiterate three key messages.

10. Current Status - tip10. Current status

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1. Title 2. Problem 3. Solution 4. Business Model

5. Underlying Magic

6. Marketing & Sales 7. Competition 8. Management

Team

9. Financial Projections

10. Current Status

The Presentation Outline