Category Archives: Pitching

Grab Your Seat at Launch 2014

LAUNCH Festival, an event where startup founders can pitch their ideas to investors, network with other startup enthusiasts and rub elbows with those who “made it” will be FREE in 2014.

The event was created by Jason Calacanis, who explained in an email why he is giving away tickets:

When I started in the industry in my 20s, I didn’t have a pot to piss in and was a ‘little rough around the edges’ – I was so lucky to have folks like Esther Dyson, Kara Swisher, John Battelle, Tim O’Reilly and (most of all) John Brockman include me in their events.

These events led to me rubbing elbows with Evan Williams, Yossi Vardi, Larry Page, Jeff Bezos, Ted Leonsis, Steve Case, Mark Cuban and countless other luminaries. Some of them became good friends and/or critical business contacts.

Now I’m trying to pay it forward for the 40+ startups that will launch onstage, the 150 that will be at demo tables, and the thousands of founders and technologists who maybe don’t have the budget yet to come to a world-class conference.

LAUNCH Festival is my legacy and I want as many folks to experience it as possible.

We had 6,000 people sign up last year and this year we hope to have 8,000 (stretch goal FTW!). This makes us the largest startup conference in the world – by far.

Grab your tickets here: http://launch.ticketleap.com/launch-festival-builder/dates

Thank you Jason!

 

 

Startup Marketing 101: You Are Not Selling a Product

Onion, by Dey via FlickrIn talking with a startup founder the other day it became clear that there was a problem. He had just lost a sale to a competitor. Not only was that extremely frustrating, he wasn’t sure why he had lost the sale. Losing deals sucks, but it can be a great way to learn so that you don’t make the same mistakes next time.

So I asked him to give me the sales pitch. It went something like this: Our product does A, B, and C. Here you can see what happens when you click this button, which shows this results. Then, when you click on the Reports icon, you can see all of the reports available, etc…

Sounds familiar? What is the problem with this approach? Well, to begin with it is very product focused. Not just features-oriented, but it is all about the product itself.

Marketing Lesson 1: You are not selling a product, you are solving a problem.

Ask yourself this question next time you are preparing to demo or sell your product or service. What is the problem I am trying to solve? How would the customer describe it?

That’s the first step. But it doesn’t stop there. You also have to understand what value you bring to the customer.

Marketing Lesson 2: You are not selling features, you are selling value.

Yup, this makes sense right? But hold on. Do you really understand what value you are providing with the product or service you are offering? Most people only scratch the surface when it comes to value. They say “with our service you don’t have to wait for taxis anymore” or “our new mobile app allows you to access your documents directly from the iPad!”. These are simply bland statements that anyone can make. Go a step further and ask “so what?”. For example, let’s take this hypothetical example of a company that has an iPad app that allows you to access your documents remotely.

The pitch: Our iPad app allows you to access your documents direcly from your iPad so that you will have them wherever you go.

Now let’s look at this and try to dig deeper. Why is this important to the customer? Oh, you see, before having our app they would have to carry their laptop with them, which is a pain. OK, we’re getting closer. What else? Well, we are targetting senior executives that need secure access to their documents and by using our app not only they can access from the iPad, they don’t need to save the files to the mobile device, which increases security. OK, this is good info, but why is this important? Because our competitors require the file to be downloaded first, which means a long wait before the user can actually see the document and it leaves the file on the device which compromises security. OK, but what is exactly the value here? Well, with our app executives can quickly access their extremely confidential documents from their iPads without having to worry about security leaks. Great, now we are in a much better shape. So let’s review our pitch.

New pitch: Executives worried about accessing confidential documents remotely can now do it securely from their iPads with a simple tap, no download necessary.

This is much better, not 100% but way better. You are talking about the customer, relating to their pain and problem, and addressing with a solution. I can see this playing out during a sales situation going something like this: “As an executive you need quick and secure access to confidential files when you’re on the road. Not only that, you want to be able to access files without having to wait for long downloads, and you want to make sure no trace is left behind. This is what we offer on our new iPad app. With our app you can…” and it continues.

The next step would be to really understand the value being provided so that you don’t fall into the features presentation trap. Faster mobile document access, for example, is just a feature. How would it help the customer? Well, they can get more done in short time. OK, this is it! Get things done faster while on the run without worrying about security and with an app that doesn’t get in your way.

As you are pitching / selling your startup idea, peel back the proverbial onion to really understand the benefit and value being provided. Few companies go through the trouble of doing it and that is why most corporate webistes look so bland and you can’t tell one from the other. By really understanding your customer pains, the problems they are trying to solve, and by really going deep into what exact value you bring to the table you will be able to craft a compelling sales pitch and position your startup above the competition.

You Are Right. VCs Don’t Know Shit.

On his blog, Lee Hower (one of LinkedIn founders) has an interesting post titled Making good decisions still means you are sometimes wrongin which he talks about the tough choices VCs have when deciding which startup to back. There are so many deals coming their way, they can’t possibly bet on every single one of them and identifying good opportunities, especially early stage, is really difficult.

I especially liked his link to Bessemer’s “anti-portfolio” web page where they show companies they declined to invest in and have great comments on why. Just goes to show that you shouldn’t feel bad after that meeting where the VC tells you the startup you have been working on and investing your life savings is not interesting to them. Maybe they are missing on the next eBay, Google, or PayPal. Just maybe. ;-)

Cool Startups at Pitch San Francisco

Pitch San Francisco ’11 is now over. An interesting gathering of over 90 startups presenting their products and services to VCs and the public, ended with the following winners:

Congratulations!

More Cool Startups

But other startups are worth mentioning. For example:

  • DealAngel: Could potentially do for hotels what HipMunk did for air travel, DealAngel has a proprietary algorithm that statistically compares hotel deals in an area to tell you which ones are actually good deals in a beautiful display that makes it easy to spot hotels and the best deals. According to Co-Founder and COO Bob Rogers, Expedia, Orbitz and the usual travel sites are not completely transparent when it comes to presenting you with the best price and they are aiming at disrupting this market. If they can crack the code and present users with a better way of saving on travel, that’s a huge market potential.
  • Let’s Listen: Yet another music site? Not quite. Let’s Listen is unique because it allows you to listen to music with your friends, online. It basically allows you and your friends to share your music library, then select a song to play and everyone will listen to the song at the same time while chatting. Simple, yet powerful. At first I was skeptic, but after watching my 15-year-old niece chat with her friends on Skype for hours while listening to music, I’m sold. Worth checking out.
  • CheckInOnMe: Want simple tech that works? I was impressed with this service. Imagine you are a girl leaving that late night study session at the college library, preparing for tomorrow’s exam. Now you have to walk all the way through the parking lot to your car or bus station. You activate CheckInOn.Me and every few minutes you get a text checking in on you. If you reply to the text, everything is fine. If you fail to reply or you reply without using the correct pass phrase, the service will alert your friends and family (you decide who) that something is not right. Is simple SMS tech used in a clever way. The possibilities are many (families checking on their kids, realtors going to other people’s homes, even babysitters).

If you missed this year’s event, make sure to sign up for the next one!

Market Size: Either You Believe or You Don’t

The question that seems to be a deal killer, no matter what type of product you are building, is the market sizing one. It comes in various formats:

  • “What is the size of the market?”
  • “How big can this get?”
  • “What are the growth prospects?”

Among others, is a key question that often turns off potential investors. Especially if you can’t answer it “correctly”.  A nice post by Bryce Roberts titled “You can never size a market in Excel“tackles this pesky problem entrepreneurs face and gives sound advice:

“An investor’s instinct around something as fundamental as whether your business can reach the scale needed for venture capital returns is one that won’t be found scouring the latest market forecasts from Forester or Goldman Sachs. It won’t be found in endless meetings and it won’t be found in detailed financial forecasts or market sizing exercises.

It will be found in the connection an investor makes to you, your product and your vision. Either they will believe it or they won’t.”

It is a refreshing view on the question of market sizing. And also tells you a bit about how to assess whether the investor in question will be really a good match with your startup.

Check out the full article here.

Avoid the Common Blunders When Pitching Investors

Probably not much new, but always a good “back to basics” kind of article that is a good refresher for new and seasoned startup founders a like.

Five Worst Mistakes Entrepreneurs Make When Pitching Angel Investors“, from Entrepreneur.com gives you the problems and the fix for each potential blunder:

Mistake No. 1: You don’t explain what problem your business solves.
The Fix: Share why customers will buy your product or service.

Mistake No. 2: You offer too many facts and numbers.
The Fix: Tell a story.

Mistake No. 3: You tout sales forecasts.
The Fix: Focus on the benefit your business offers customers.

Mistake No. 4: You’re too attached to your business plan.
The Fix: Embrace new revenue opportunities.

Mistake No. 5: You discuss ownership stakes.
The Fix: Save it for the follow-up.

Check out the full article, here.

How to Turn the Table When Pitching Your Startup

Jester by mrpolyonymous @ FlickrIf there’s a subject every startup founder fears, is the pitching / fundraising. No matter how many pitch sessions, competitions, and training you do there is still room for improvement. But, as my kung-fu instructor used to say “practice doesn’t make perfect, perfect practice makes perfect!”. You’ve gotta know how to pitch right to be able to raise capital.

The Perfect Pitch

A recent Mixergy interview with Oren Klaff (author of “Pitch Anything“) is a great source of material to better understand the dynamics of the perfect pitch. A key concept he talks about during the interview is turning the table and instead being the jester performing in front of kings, make the VCs, Angels, Private Equity guys the ones who have to perform to get the privilege to fund your business.

Easily said than done? Sure,  but the interview is worth watching for great insight into how to better prepare yourself for the fundraising presentation.

The Jester is Not You

Throughout the interview Oren talks about key concepts he discovered that allowed him to get multi-million dollar deals. Here are a few:

Turn the Table: When you come in for a meeting with a VC or private equity firm, usually right in the beginning they will spend a few minutes introducing you to their partners and telling you about their company. Turn it around and instead suggest you pitch right away and have them at the end talk about their company in the context you presented. This will save you time and will put you in a stronger position.

The Big Idea: Instead of being too quick to dissect your pitch, talking about the market, opportunity, distribution, etc. think of the Big Idea. Capture the painful problem you are trying to solve and tell the audience (VC, Angel, etc.) how you can solve it. Your big idea should trigger an emotional response, be insightful. You want people to start thinking/saying “wow, I didn’t know that! That is very interesting. I want to learn more.”

Creating Tension: If you had two, three, five hours to pitch someone you probably could convince them that your idea is good and worthy of investment. But you have 20 minutes of their attention, so you have to use tension and novelty. When you lose the neediness, when you push people away, that is when the most amount of capital is raised. Be direct, forthright, not supplicating.

Want an example? This is a great clip to watch:

(Don Draper, from Mad Men, giving a pitch).

Novelty: People come to meetings or talk to you to learn about new things, meet interesting people, learn about places and ideas they have not heard about before. The second people can interpolate, extrapolate, figure out, or create a pattern on what you’re doing, they are checked-out and gone. Don’t use the same powerpoint deck template everyone uses, try something different, show that you are different. Peak their interest in you and your idea.

Big Picture: Don’t let yourself get bogged down during the pitch by detailed questions that want to escape the “big idea” frame, because that’s just a way they are using to filter you and go from an emotional to analytical frame of mind. So when asked about revenues, put that off by saying you have them and will get to that later but let’s just focus on the big picture first, the whole concept you are trying to present. You only have 20 minutes (even if the meeting is scheduled for one hour, you only have 20 minutes of their attention anyways), so better make it count and focus on the big important things.

The Full Interview

MixergyIt’s worth checking out the full interview at Mixergy. Andrew asks detailed questions and Oren is a great speaker. Definitely worth watching.

What Office Hours at YCombinator Looks Like

If you ever wondered what would be like to chat with Paul Graham about your startup, here’s your chance to take a peek at what’s like to be questioned, contradicted, and enlightened during YCombinator‘s famous “office hours”.

At TechCrunch Disrupt, they asked Paul to give a few startup founders some on-stage advice as if he were talking to his own incubator companies. The result is pretty entertaining and makes you think about the questions he poses and what you would answer.

The two key questions that came up during every single interview, are “what problem are you solving” and “who needs your product desperately”. Think about that for a moment and write down your answer. Now watch the video and see how others tried answering these same critical questions.

Click the image below to watch and enjoy!

TechCrunch Disrupt Office Hours