If you were to witness a startup pitch from two startups with equally cool technology, equally smart founders, and an equally attractive upside in front of the exact same group of investors on the exact same day, logic would say that they would both raise money for their startup, right? Wrong. Here’s why:
At a recent angel investor group meeting, I witnessed this paradox of logic unfold, and I had to ask; Why did two of the companies raise cash, and the other two walk away empty-handed? They all had great tech, good plans, and solid founders, so what happened? I decided to go to the instant replay for answers. The meeting had been recorded so other angels could watch online, and with video and investor commit sheets in hand, I did some analysis and identified three bad startup pitch habits that cost these companies dearly:
- Trying Too Hard to Establish Credibility: During a pitch, you have only moments to capture investors’ imaginations; do it quickly or you’ve lost us. One presenter spent the first 4 of his allotted 12 minutes trying to convince us that he and his team were experts in their field before he ever mentioned what big market problem he was solving and how. When he did get to the important part, it was too late: most of the room was confused or had checked out completely. THE FIX: Assume you have the benefit of the doubt. Hey, we invited you to pitch right? So start with the problem and your unique solution followed by why your team is best suited to implement that solution, in that order. A compelling pitch will convince us that you have the right stuff! Leave the resumes for the follow-up meeting.
- Hiding Behind The Podium: Being a CEO requires a lot of things; leadership and confidence are chief among them. Nothing screams “scared puppy” faster than a CEO who hides behind a wooden box and then leans on it to lessen his exposure. As an angel investor, I want to believe that you are the type of person who is not afraid to be out front, leading the charge, rallying the troops-especially when times are tough (which they inevitably will be for every startup). THE FIX: Invest in a wireless slide advancer and stand as close to your audience as you can without obscuring their view of your slides. Stand with your shoulders back and head high; always speak to the audience and never to your slides. Show me the type of inspiring leader you are, and I will follow.
- Running Out of Time: Nothing leaves you and your pitch hanging out to dry like letting the clock beat you. When a presenter rushes through the last 4 slides in less than a minute, it leaves us with the impression that he didn’t prepare. Not a good sign! THE FIX: Limit your time on each slide. Got 12 minutes? Assign a predetermined amount of time to each slide: perhaps important slides get 1 ½ minutes and others get less. Set up a timer so you can track how long you spend on each slide and be sure to rehearse until it’s second nature. If you can, have a co-founder or team member in the audience to signal you to keep moving; that is a great way to stay on track.
In the ultra-competitive world of startup funding, every detail matters. Spend a little time practicing your startup pitch to avoid these three killers, and come away on top!