Lesson Overview

In this lesson we will:

  • Get real advice to how to run the pitch meeting
  • Use a real life example to analyse a pitch
  • Analyse the play by play

This is a 2 part series, if you missed the first part then check out how to build your pitch deck here.

How should you run the pitch meeting?

1. Be a human

The first thing to understand is that everybody in the room is a human, just like you. At the very essence of a pitch meeting, investors are trying to find out two things:

  1. Whether or not your business, idea, vision suits their portfolio
  2. Whether or not they can see the potential you are bringing to the table.

You will get more rejections than offers and it’s a numbers game, even if you had the best pitch in the world.

That means that if you have nailed your pitch deck, and have practiced your presentation, all that is left is you. We should, therefore, ‘remember the human’ as reddit’s motto goes. If we dive down to its core, what we are really saying here is that you need to look and sound confident, because confidence generally means assurance, and assurance means success.

Harvard Business Review sums up the traits of confident presentation characteristics excellently:

  1. Make Eye Contact
  2. Use Gestures
  3. Eliminate Filler Words
  4. Take time to pause
  5. Vary your pace

There are very few people in this world that nail all five of these presentation facets, but if you are able to try your best, take a breath, and make eye contact then you are already ahead.

2. Stay Interactive, engaging, and pause for questions

We have all either done this or have been on the receiving end of this, however one of the worst feelings in the world is if you reach the halfway point in a story and you realise you are talking at somebody, not with them.

The same goes with pitch decks and the meeting. Sure, your information is all on the pitch deck itself. But you are not there to just read slides. You are there to win hearts and minds about your excellent business. Therefore it is highly important to pause at appropriate moments and let the investors ask any questions. Don’t be afraid to, where appropriate:

  • Veer off script
  • Disagree without being argumentative (you aren’t there to please everyone)
  • Not have an answer
    • Not having an answer and being honest about it is better than babbling

Deep Dive: Let’s Review a Real Life Pitch!

There are many great resources on the internet just like this one that provide advice on pitch decks, but did you know that there’s a podcast that runs through real life pitch meetings (we are not affiliated to this, just big fans)? It’s call ‘The Pitch’ and we are obsessed.

For this lesson we’d like you to watch this episode. Before you press, play, though, we recommend getting and paper and noting down your thoughts about:

Activity

  • Pitch Format
    • How did the pitch go? If you were a VC would you feel like you understood the business enough?
    • If you were in the shoes of the owner, would you have presented any differently?
    • Note down timestamps and any points of interest. We dissect the pitch together, below.
  • Presentation
    • Note any interesting presentation styles (or lack thereof)
  • Engagement of Investors
    • How well did the business owner engage the investors?

Is Social Shopping a Scalable Business?

Checkpoint - What did you notice? How does it relate to what we have already learned?

  • Pitch Format
    • 2.15: 10 second introduction with implementation of Unique Value Proposition
      • I know within 10 seconds with industry this company is in, and what they are aiming to achieve
      • “I’m excited to be here today to share more about why I left my successful career in real estate to build the future of ecommerce and social shopping”.
    • 2.26 - Market definition, UVP, and problem statement “The way that we shop and consume content has fundamentally shifted”
      • Inspiration can strike at any time: I was sent a link two weeks ago and now I can’t remember who sent it or I took a screenshot on my phone and the screenshot is lost on my camera roll
      • The real problem: Our consumer journeys have become extremely fragmented
      • Secondary problem: Abandoned carts and the billions of lost revenue for the brands involved (for retailers)
    • 2.49: The solution: Locked is productizing the unmet needs for both consumers and Brands
    • 2.55: Demo and journey:
      • Features, demonstration of app
    • 3.12: Our 40,000 users have organically saved over 1 mil products
    • 3.19: The ask: Raising 3 million to invest in the people nad hte product that will continue to capture the $1 trillion online shopping market
  • [Insert Checkboxes]
  • All of the relevant information of the business was jam packed into the pitch, which took a total of 1 minute. There was a brief pause and an investor chimed in quickly.
  • At this point, the pitch feels fun, to the point, and Kristine exudes confidence. Absolutely nailed the pitch.
  • While it is highly likely that Kristine has stored the monetization of the product at a later point in the presentation, she answers swiftly and confidently when asked about monetisation. Flexibility is extremely important in these scnearios.
  • 4:14 - Investor asks ‘Doesn’t pinterest do this?' to which Kristine responds ‘If I could use pinterest, I wouldn’t be here today'. She then uses this opportunity to talk about competition and product market fit of her product.
    • The danger of this approach is if you are pigeon holed into a question, you may not have the opportunity to talk about competitors as a whole (e.g. there may be more competitors than pinterest, and you may not be able to talk about them if you directly answer the question and only talk through pinterest as a competitor).
  • 6:15: Go to market strategy
  • 6:55 - market demographics
  • 7:05 - Product build timelines, user metrics and boostrap metrics
    • This shows competency and team building
  • 8:15 - An investor asks a question about metrics and Kristine does not have an answer - Says ‘To be honest, I don’t know'
  • 9:30 Bit of a fumble - not understanding the investors question
  • 9:45: Lessons from previous competitors
  • 10:45 - 5 year plan
  • 11:30 - investor terms. “Why did you pick $3 million to raise?” A: It was what we need plus 50% beause that was kind of what was advised to us given the state of the market.
    • This is clearly the least confident that Kristine was in the entire pitch. Notice how she started using filler words, and referenced a third party who ‘advised’ that it’s the figure she should reach. This removes her from the decision, and makes her look less competent.
    • The investors clearly picked up on this because they started giving her advice and essentially said that she is raising too much, and that she needs to be ‘more scrappy’ - because ‘what she needs + 50%’ is an unaceptable answer
  • 12:40 - First investor is out: “I don’t have a grasp of this category in order to add any value or be able to assess it properly”.
    • As we mentioned previously: You will get more rejections than offers and it’s a numbers game, even if you had the best pitch in the world.
  • 13:25: Investor 2: Likes her as a founder, likes what she is doing. Considering the history of the market and this product category, has concerns over the product ‘being sticky’.
    • What the investor, in a nutshell, is saying is ‘your product is not unique enough to make an impact’
    • The founder quickly comes back, thanks him, and says ‘one thing I’ll say to your point about stickiness is that once a user joins, it’s hard to leave' IE we do have a unique point of differentiation.
      • Analysis: Response from founder was great - not offended, and wanted to respectfully disagree.
  • 14:30: Investor 3: I’m out as well. Excellent founder - did market research. Doesn’t like the tech space she’s in.
  • 14:50: Investor 4: Out because you’re too early.
  • 15:30: Founder starts crying.
    • This is a really tough one, she’s clearly extremely passionate about her product (her names on it). Building businesses is extremely emotional, tiring, and you have to put your mind, body and spirit into the product. Not only that, the amount of time invested is astronomical in comparison to a day job. While crying could be seen as unprofessional, it could also be seen as meeting point 1: Being human. This is a passionate human, who believes in her idea so much that it draws out a core human emotion.
  • 16:00 Investor analysis:
    • The sentiment is that she’s got something, but with her kind of business she needed more proof points because it’s such a competitive industry.
      • Does that mean she pitched too early? Or, perhaps they just were not the correct cohort of investors.
    • Summed up succinctly, one of the investors said ‘We started coming at it from the point of ‘why would I invest?’ rather than ‘why wouldn’t I invest?’
  • Presentation
    • No pitch deck seen! It was just a normal conversation.
  • Engagement of Investors
    • 2:04 Handshake and smile for each investor
    • 2.04 Attire is professional but fun (appropriate for the business type)

Overall thoughts:

Pros:

  • It’s very evident that she is confident and full of pride in regard to her product. As a founder she is very investible
  • Many of the answers provided were off-the-cuff and genuine, which clearly put the investors more at ease.

Cons:

  • There’s a lot of backflipping between subjects. This could be due to the editing of the show, but there’s a reason why pitch decks are used: So there’s a format. These investors are very forgiving and have guided the conversation, but I believe that this is the detriment of Locker, as it means that they have less control over the conversation.

If, like me, you were interested in finding out what happened next, you can listen to their podcast from 22:55 - it’s a rollercoaster.

After the Pitch: Follow up

Always ensure you follow up after the pitch, even if it didn’t go well. There are many reasons for doing this, even if just to be polite.

In our specific case example, Kristine received the direct feedback that she needs more ‘proof points’. This means that she pitched too early for some of the investors. By sending a simple follow up and later down the track an update of her key metrics, it may reopen the conversation for further investment. It may also help founders keep in contact for future businesses they need funding for. Just never burn the bridge.

Further Reading

  • Check out The Pitch YouTube channel for more great pitch meetings. Each one brings something to the table, and generally something that could be improved.

Assignment

  • Listen to two more pitches and write down your thoughts
  • Practice your own pitch! Record yourself in front of the mirror and

Knowledge Check

  • What are the two rules to keep in mind when running a pitch meeting