January 25, 2018
Author: Dennis Ensing
A natural output of our Angel group’s screening process is coaching entrepreneurs on their presentation content. Last year, we moved them from a recommended 20-minute presentation to 15 minutes and will be moving forward with another reduction to 10 minutes as part of a revamped process coming online in the next couple of months. Under this new “regime”, the total time allotted to presenters will be 30 minutes. The 10-minute presentation time won’t be enforced rigidly, but the presenters will start to use their Q&A time with our investor members if they run over. The Q&A is usually the most valuable time they have to personally interact and influence our members’ opinions on their investability.
Generally, more time does not make for a better presentation. It seems that in most cases, the more time presenters have, the more likely they will lose investor engagement. This post outlines what actually makes for a good pitch. The best presentations we see cover all of the following, and yes in this order:
- Company Purpose – What the business is
- The Problem – The reason why customers care whether the business exists and why satisfying that care is great business
- Solution – The offering or “secret sauce” that will draw customers and the strategy that will get it to market quickly
- Why Now? – The specific needs or market circumstances that prompted the launch of the business
- Market Size – The profile and potential number of customers, size of niche and your share
- Competition – An assessment of the difference in value proposition and individual circumstances of every alternative to your business (including the customer doing nothing at all)
- Product – Keep it simple!
- Business Model – This includes business partnerships, first customers and other head starts the company can claim
- Team – The entrepreneurs’ roles and relevant background; Board composition
- Financials – Key cash, staffing, customer and product expectations
The challenge for presenters is getting enough of the above across to achieve their objective. I think some naively believe that objective is to convince our members to write cheques at the conclusion of the Investor meeting and so try to dump everything and the kitchen sink into their presentations. Instead, the entrepreneur should simply focus on securing enough interest that potential investors will sign up for a deeper dive call with them – generally the beginning of due diligence – usually held within a week of the presentation. And the more persuasively and succinctly they can do that, the better!