Life's a Pitch

Want Entrepreneurial Success? It's all in Your Mind

"Nothing can stop the man with the right mental attitude from achieving his goal, nothing can help the man with the wrong attitude.”

                                                                                                     Jefferson

It’s often said that the primary reason startups fail is a lack of funding. Ultimately, whether startup failure is attributed to funding challenges, market conditions, too much competition or the economy, the underlying cause can almost always be found in the same place – the entrepreneurs mind.

World Class Athletes and the Military

Some experts contend that psychology is 80% of the reason why a person fails or succeeds. The critical role psychology plays in a successful outcome is recognized by world class athletes, military and Fortune 500 companies. Many sports coaches will place as much importance on ensuring their athletes develop a winning mindset through the consistent practice of regular psychological exercises as they do on the physical training.

And throughout the world, the military ensure their personnel undergo intensive psychological training in order to prepare them for the extreme challenges they may face. In the US, The United States Military Academy (USMA) created the Performance Enhancement Program which integrates 5 elements of applied psychology into a systematic approach. These elements include goal setting, attention control, stress management and visualization.

Psychology and Entrepreneur Performance

Parallels are often drawn between the psychological stresses entrepreneurs face and those faced by world class athletes and military personnel. The late Anita Roddick, Founder of the Body Shop once said

“Nobody talks of entrepreneurship as survival, but that's exactly what it is.”

Many entrepreneurs invest their savings and a huge part of their life trying to make their dream of startup success a reality. They often do while holding down at least one day job, often neglecting family, friends and their health. The stakes are high, the challenges and stresses very real.

When working with clients on our Entrepreneur Peak Performance Program, I consistently see the same psychological causes preventing success. These include:

1.An inability to retain a laser focus on achieving goals because of the demands and distractions of daily life e.g. family, holding down several jobs, bills etc.

2. A fear of failure that prevents necessary actions and risks being taken.

3. An inability to consistently take the steps necessary to achieve long term goals. Entrepreneurs are often have clarity on the long term goal, but struggle to maintain consistency and momentum when things go wrong and the timeline slips.

4. Burnout

Develop those Mental Muscles

It isn’t sufficient to have a goal and high levels of optimism in the beginning. If it was that simple, the military and world class athletes and their coaches would not invest the time and money on developing winning mindsets.

Your ability to withstand the challenges and stresses associated with launching a startup and achieve your goal faster and more effectively, will be significantly enhanced if you devote time to developing your mental muscles and a winning psychology. A failure to do so, may well mean that your dream of startup success continues to exist only in your mind.

Martin is the creator of the Entrepreneur Peak Performance (EPP) program and author of 'Here's the Pitch'

 

10 Pitch Deck Principles (or How to Blow them Away With Your Deck)

Taken from ‘Here’s the Pitch- How to Pitch Your Business to Anyone, Get Funded and Win Clients’

Most pitch decks are disasters. They are confusing, boring, uninspiring, and misused. The worst thing is that it isn’t a secret. Death by PowerPoint is a syndrome as well-known as many a medical condition.

Despite the efforts of presentation design gurus such as Nancy Duarte (Slide:ology) and Garr Reynolds (Presentation Zen) to show the world a better way, by and large entrepreneurs continue to churn out the same text-laden pitch killers.

Adopt the following principles, and you'll ensure your pitch deck stands out from the crowd and engages and excites your audience:

1.         Make yourself the focus of your pitch rather than your visual presentation. Your presentation is there to support and reinforce your key messages, not replace you.

2.         Don’t create a text-rich, picture-poor presentation. People cannot read and listen at the same time. If your audience is reading from the text on your PowerPoint, they are not listening to you. Of course there will be some slides where some text is necessary, but they should be the exception rather than the rule. If you must use text, try to follow Seth Godin’s wise words of never more than six words on a slide.

The proper place for a text-rich document is either in the executive summary or presentation you send ahead or the document you leave behind.

3.     Use stunning visuals. Do it like Steve Jobs, and use stunning visuals and the odd word or term here or there. Great visuals inspire and engage people emotionally.

4.         Ban the bullets. Bullets kill people, and bullet points kill presentations. Don’t use them. They are unattractive and will detract from the aesthetic qualities of your images. If you heed the advice to abandon using text, then you will no longer have a need for them.

5.         Don’t use animations or transitions. They are cheesy and overused, add nothing, and are distracting. Remember, you must remain the focus throughout your pitch.

6.         Aim for simplicity and clarity. Each slide should convey a single thought or idea.

7.         Place your logo smartly. Use your company logo on only the first and last slide so as to minimize any visual distractions.

8.         Use quotes and data that support your key messages. A slide with a single quote or significant statistic from a credible source can be very impactful.

9.         Review and edit. Once you have created your presentation, review it with the filter of asking whether or not each slide directly supports your primary objective i.e. securing investment or the sale. If it doesn’t, delete it.

10.         Address your audience’s concerns. It may be your pitch but you need to focus on what’s important to them, not you.

Martin is the creator of Startup Caffeine and the author of 'Here's the Pitch - How to Pitch Your Business to Anyone, Get Funded and Win New Clients' available from Amazon, Barnes & Noble and all leading booksellers.

 

The Most Important Key to Delivering a Killer Pitch

“By failing to prepare, you are preparing to fail.”

                                                                                                               Benjamin Franklin

Three undisputed truths:

1.            Delivering a winning pitch will often determine the survival and success of a business.

2.            People create their best work when they have time, space, and silence.

3.            Proper rehearsal is critical to delivering a professional, persuasive performance.

Despite these truths, most sales and investor pitch preparation takes place at the eleventh hour, amid constant distraction and noise with minimal, if any, rehearsal. Small wonder that most pitches are weak and ineffective and consequently fail.

“The first draft of anything is shit.”

                                                                                                        Ernest Hemmingway

There are two phases to all pitch preparation. The first is the creative process where you create your presentation and prepare your delivery. The second phase is rehearsal. Both take a considerable investment of time—days, weeks, and months, rather than seconds, minutes, and hours. This is not easy for time strapped entrepreneurs working in cash starved startups; but it is essential.

The greatest performers, athletes and world-class experts from every field are not ‘naturals’. They reached the top of their game through using effective techniques and investing thousands of hours in preparation.

Neuroscientist Daniel Levitin, in ‘This is Your Brain on Music’, talks about 10,000 hours of practice being the magic number to achieve mastery:

… ten thousand hours of practice is required to achieve the level of mastery associated with being a world-class expert—in anything. In study after study, of composers, basketball players, fiction writers, ice skaters, concert pianists, chess players, master criminals, and what have you, this number comes up again and again. Ten thousand hours is the equivalent to roughly three hours per day, or twenty hours per week, of practice over 10 years. . . . But no one has yet found a case in which true world-class expertise was accomplished in less time. It seems that it takes the brain this long to assimilate all that it needs to know to achieve true mastery.

Steve Jobs, wrongly perceived by many to have been a naturally gifted performer, was reported in Businessweek to spend “grueling hours of practice” when preparing his Macworld keynote speeches, a process Jobs began weeks ahead, even though he had been delivering spectacular keynote speeches for years. Jobs made presenting look easy because he worked so hard at it.

Starting your preparation well in advance of a pitch allows you time to research, reflect, and revise. Time gives you the opportunity to step back and look at the big picture and develop and refine your pitch so that you avoid the pitfall that Hemmingway highlights in the quote in this post.

Your choice is simple. If you want to create a forgettable, boring pitch that fails, simply spend a few hours at the last minute rehashing a pitch you delivered previously. If, however, you want to create a pitch that motivates your audience to take action, start your preparation weeks in advance of your meeting, and be prepared to invest days, if not weeks, in its creation.

Martin is the author of 'Here's the Pitch' available now from Amazon and Barnes & Noble and all leading booksellers

 

How to Create a Brutally Simple Pitch

As communication channels increase along with the speed of doing business, the ability to pitch your startup in one sentence, becomes critical. This applies equally to both sales and investor pitches.

Unfortunately, most entrepreneurs are so immersed in the minutiae of their business, that they forget the importance of communicating clearly and simply to an audience who is being exposed to their idea for the first time.

Many years ago I hired global ad agency M & C Saatchi to help a startup I was advising. Their philosophy is ‘Brutal Simplicity of Thought’ and is clearly a key to their success. Their rationale is that simple ideas enter the brain easier and stay there longer.

A concise one liner is easier to remember and easier to share with others.

There are two approaches to pitching your startup in one sentence. The first is to create a ‘high concept pitch’. Alienwas pitched to studio executives as ‘Jaws in Space’. As is true of all ‘less is more’ approaches, creating an effective and impactful high concept pitch takes time but is worth the effort.

An alternative approach is to use the following formula:

My company  [company name]

Has developed / is developing [product / service]

That solves the problem [define problem]

For [target market]

So an example might be

Acme has developed an app that delivers a light electric shock via a smart phone, that solves the problem of investor attention disorder, faced by entrepreneurs raising capital.

Whichever approach you use, if you want to be heard, understood and remembered, make sure that an effective one sentence pitch forms part of your pitching arsenal.

Martin is the author of 'Here's the Pitch - How to Pitch Your Business to Anyone, Get Funded and Win New Clients' available from Amazon, Barnes & Noble and all leading booksellers.

 

How to Become an Investor Magnet

This is the true story of ‘Ryan’ (not his real name). A serial entrepreneur with no qualifications and a very limited understanding of financials or launching a startup. Ryan, however, is an entrepreneur with a deep understanding of people, who consistently and easily raises hundreds of thousands of dollars from very savvy, experienced investors.

I first came across Ryan six years ago when he approached me to help him create some pitch materials. He explained that he had persuaded 2 investors (both bankers) to invest $500K in his IDEA (no prototype, company or team) but that one of the investors had asked to see details of his business model and financial projections.

Initially, I was sceptical as to whether the potential investors had, in fact, actually committed or had simply expressed an interest in learning more about Ryan’s idea.

Sensing my scepticism, Ryan called one of the bankers on his cell phone, explained I was helping him put together the information that had been requested and asked him to confirm to me that he was investing. Sure enough, banker X confirmed that both he and banker Y were investing but would appreciate understanding a bit more detail. About a month later, Ryan received the investment.

I subsequently helped Ryan raise nearly 2 million dollars over the next two years, though it’s fair to say that my role seemed limited and that all I was doing was effectively confirming, in writing, deals that Ryan had already successfully pitched and negotiated.

Over time, through observation and discussion, I came to understand that although Ryan is a very disorganized, creative entrepreneur, he does use a highly effective ‘system’ for securing investors. This is how Ryan does it.

1. Research – Ryan goes out of his way to identify potential angel investors. Typically these are people who have some capital and are involved in business or finance. Ryan’s research method is real world as opposed to virtual. He is a ‘social butterfly’ continually making new connections and expressing a deep interest in these people and their friends.

 Slowly but surely, Ryan builds up a picture of those people who are likely to be potential investors.

2. Target Early – Once Ryan identifies his prey (potential investors), he puts himself into situations where he will meet them.  This can be anything from the opening of an art gallery to a mutual acquaintances party. Ryan is very determined and resourceful and always seems to find a way to cross the path of his targets.

 Ryan doesn’t wait until he is desperate funding. He describes himself as being in ‘perpetual funding mode’. By lining investors up in advance, he effectively ensures that he is able to access investment as and when he needs it.

3. Seduce – Applying the same principles that most of us use to persuade someone to come on a date, Ryan presents his best side to his target. In addition to being upbeat, witty and charming, Ryan expresses deep interest in the potential investor. He makes the encounter about them and makes every effort to ensure they enjoy the experience of meeting him. Far better than pitching an investor at a urinal!

 Though Ryan has the same worries and stresses that every entrepreneur does, he never reveals these to his target. He also never talks about his latest venture unless specifically asked. Social protocol means that he is always asked about what he does. 

4. Convey Success – Ryan is a master at making dry toast sound mouth- watering. When asked what he does by his targets, he always makes it sound as though he is already successful. While being careful never to mislead, Ryan focuses on the positive and any successes that he has already achieved as well as others who are interested in his venture. Even when talking of potential challenges, Ryan focuses on the solutions.

5. Engage – Having already worked out what makes his potential investor tick, Ryan focuses on those points that are most likely to appeal to them. He always asks for their opinion and lets them know he values it. Importantly, however, Ryan never mentions that he is looking for investment unless pressed by his target.
 
6. Enchant – In his latest book ‘Enchantment’ Guy Kawasaki discusses the importance of enchantment to business success. Ryan understands this principle well and makes his ‘investor encounters’ magical, mesmerising experiences using the power of story and likeability, while focussing on how his venture will make a difference to the lives of others. If you want to enchant others, I strongly recommend you read Guy’s book.

7. Hook and Leave – Though somewhat counter intuitive, Ryan usually leaves the encounter at the point he is certain his target’s interest is at its high point. This seems to be a variation on ‘playing hard to get’ which tends to have the desired effect with the target making contact a few days later with a request that Ryan let them invest.

Conclusion

Ryan’s way may not be for every entrepreneur. But Ryan has proved time and time again that it works. Even during today’s tough economic climate. Many of the techniques and strategies Ryan’s uses are the very same advocated by Angels and VC’s in their blog posts and elsewhere.

At the end of the day, Ryan is focussing on building relationships. People and relationships are the most critical factors in investment. This is why investors consistently say that the team is the most important factor in a deal. It is also why when talking about an investment, investors will often start out by saying that the founder is a great person with lots of integrity

Free Startup Coaching Videos: Bootstrapping - Pitching - Marketing

 

Why Most Startups Shouldn’t Seek Investment

 client said to me last week that if I was so against startups raising capital from investors, why did I always blog and tweet about pitching investors. Fair point, made in response to my attempt to encourage him to bootstrap rather than pursue Angel Funding.

The current bubbling market and spate of tech IPO’s seems to have increased the desirability of getting funded by Angel Investors or Venture Capitalists. While investor funding may be the right option for some startups, these instances are by far the minority of cases.

Why You Don't Want Investment

There are several compelling reasons not to seek investment from Angel’s and VC’s:

1. You lose control of your startups destiny. This is your life and your startup. While you should welcome the advice of seasoned investors, you always want to retain the option of rejecting it.

2. Fundraising is time and energy consuming and often demoralizing. No matter how good your business or investor pitch, securing investment takes months, sometimes years. For the vast majority, they will be unsuccessful. No matter how determined an entrepreneur you are, frequent rejections are demoralizing. Far better to spend that time and energy growing your startup.

3. Far better to receive 100% of the profits. The old adage that 50% of something is better than 100% of nothing only holds true if it is impossible to launch and grow without investment. Investment taken when it isn’t really needed, is simply a short term booster  that is ultimately replaced by long term pain.

A Better Well-Trodden Path to Success

There are many startups all over the world who have successfully bootstrapped their way to millions. As you may have seen this week, the team at CSN Stores bootstrapped their way to $380 million in sales in 2010, before deciding to take $165 million in Venture Capital.

37 Signals have an inspirational series on their website ‘Bootstrapped, Profitable and Proud’ which profiles companies that 1) have $1MM+ in revenues, 2) didn’t take VC, and 3) are profitable.

And lastly, Dileep Rao, in ‘Bootstrap to Billions’ documents in some detail the journeys of entrepreneurs who have built their goliath companies from scratch.

Embed Bootstrapping in Your DNA

For bootstrapping to have any meaningful impact, entrepreneurs must adopt and implement bootstrapping tactics and strategies across the whole of their business. Bootstrapping will not work where only one or two strategies are employed on an ad hoc basis.

Startups who have bootstrapped their way to millions or even billions, regard their bootstrap plan with the same importance as their business plan. Without a proper bootstrap plan that you execute, your business plan may end simply end up as a record of your aspirations.

So, to the entrepreneur who inspired this post; ‘thank you’. Putting our money where our mouths are, we’ve created two free comprehensive bootstrapping videos and a detailed Mindmap which can be accessed here ‘The Bootstrap Blueprint’. Here’s to your investor free success!

The Different Objectives of an Executive Summary and Investor Deck

A common area of confusion on the part of entrepreneurs seeking to raise capital is the different objectives of an Executive Summary and an Investor Deck (usually a PowerPoint).

Typically an Executive Summary will be sent to an investor before any meeting. The  objective is to engage the investor and often to secure the first meeting. The fact that you will not be present to speak to, elaborate up and clarify the Executive Summary means you must make sure that it is a document that provides an investor with sufficient information to answer the key questions and issues they will focus on.

 It is for this reason that Executive Summary documents are primarily text based and will contain paragraphs of information rather than short sentences. You can read more about the proper content and format of an Executive Summary in my post ‘The Complete Guide to Creating an Investor Focussed Executive Summary’.

In contrast, an Investor Deck is usually presented by an entrepreneur at a first meeting with an investor. The objective at this point is to get the investor to take things to the next stage. As you are present, the Deck should be supporting your investor presentation, not replacing you. You will be outlining the elements of your investor proposition while referring to your Deck to illustrate, demonstrate or reinforce your key points.

The Deck will usually contain a number of graphics, diagrams and charts and should use a bullet point format for information. See my recent post ‘The Investor Pitch Deck and Why Less is More’ for advice on format.

I should add that there are some investors who will request a Deck before meeting you, rather than an Executive Summary. If this occurs, you will need to tweek your Deck to ensure that the information presented is clear enough for the investor to understand without assistance from you.

Three Ways to Kill Your Investor Pitch

It sometimes happens that there is a point during an investor pitch when something is said by the entrepreneur which instantly kills their chances of securing funding. It is the point at which there is no return and nothing can be said to repair the damage. You know it’s happened because the investor(s) stops listening, changes their tone of voice and hurries you on.

I took the opportunity the other night at a dinner with several angel investors to ask them what were the three things that would destroy the chances of an otherwise decent investor presentation. I asked the Angels to focus on substance rather than style i.e. the investment proposition fundamentals rather than pitch technique.  The top three were as follows:

Lack of clarity on the numbers

This evil covers a range of sins including:

1.   Not being clear as to precisely how much investment is required.

2.   Not being clear as to what milestones will be achieved by different stages of funding.

3.   Not being on top of revenue projections. Even though the Angels agreed that projections rarely bear any resemblance to reality, it is essential that the CEO / Founder is on top of the numbers and should not hide behind the CFO.

Not Having a Clear Go to Market Strategy

For reasons that I’m convinced are rooted in human nature, entrepreneurs will often  spend enormous amounts of time, energy and creativity on the development of their product or service but not give sufficient attention to the development of a well thought out route to market.

Without sales, the best designed product in the world, is of no interest to an investor. An entrepreneur’s pitch deck will often identify potential customers but not deal with key issues such as:

1.   What channels of distribution will be used and how will they be established.

2.   Who within the company has the experience and expertise to execute the sales strategy.

3.   How will potential customers awareness of the product / service be created.

Linked to the issue of a lack of go to market strategy, is a confusing of the market size with the addressable market. The addressable market is limited to the company’s industry focus in contrast to high-level market size numbers relating to that sector of the economy.

Maintaining There is No Competition

Competition is a good thing as it implies there is money to be made and provides an opportunity to learn from the competition’s mistakes and triumphs. It is very rare to find a situation where there is no competition, whether they be startups or established companies.

At a minimum, an entrepreneur pitching Angel Investors or Venture Capitalists for funding, needs to be able to:

1.   Identify the competition

2.   Compare the products / services.

3.   Explain what their product/ service has that the competition doesn’t.

It seemed only fair that I buy dinner in return for this free market research…

Why 'How' is Critical to Your Investor Pitch

An entrepreneur’s investor presentation documents and pitch will typically focus on the product or service, numbers, competition, sales strategy and team. What is often missing, however, is ‘how’ key stages and milestones will achieved. In other words ‘how’ the entrepreneur and his team will execute.

An entrepreneur can have an exciting idea with significant revenue potential, but if they fail to reassure the investor that they have the ability to execute, they will not get funded. I spent a couple of years working alongside a very experienced Chief Operating Officer who frequently managed projects worth over $100 million. Whenever a member of the team would state what they intended to do or what needed to be done, she would say ‘by who, by when’ and ‘how’. She even planned her vacations with a Gantt Chart!

When I first encountered Angel Investors and Venture Capitalists seven years years ago, I noticed that they asked the very same questions time and time again of entrepreneurs pitching them. The most common terms used in every meeting seemed to be ‘how’. How will you bring on board your first strategic partner? How will acquire customers? How will you find the CTO you urgently need?  

Reassuring an investor that you have the ability to execute can be achieved in two ways. Firstly, by proving that you have previously launched other startups that are successful. A good track record counts for a lot. Secondly, by having thought through how you will execute all key stages / tasks and being able clearly explain this to investors.

It is not necessary for you to spell out the detail of ‘how’ in your Executive Summary or Deck, as that is not the purpose of these documents. You must, however, deal with ‘how’ at a high level in your documents and be prepared to give detailed answers to the ‘how’ questions that investors will inevitably fire at you.

Why Great Substance + Great Form = A Winning Investor Pitch

It is often said that ‘it’s not what you say but how you say it that matters’. When it comes to investor presentation documents, substance will always triumph over style. If, however, your documents are unprofessional or unclear you run a very real risk of not getting funded.

An investor may pass on the opportunity of funding you if your executive summary, deck or business plan aren’t up to scratch because:

·     You have missed out key information;

·     It is not clear to them how your business will generate revenue;

·     They believe that your inability to prepare professional looking documentation will mean you will do the same for a prospective customer or client; or

·     You simply couldn’t bothered to create investor focused documents.

So while an investor will always primarily focus on numbers, team, execution, sales strategy etc, remember that the key to a successful pitch is great substance and great form.