The three stages of a startup pitch

Many entrepreneurs claim to have the best next story, truth is, most pitches are full of shit. Not intentionally, mind you, but most start-ups don’t realize how ineffective their communication is. It’s not until you remove the blind fold with an active audience that they understand how broken it really is.

There seems to be a widespread notion that pitching is a waste of time and, as I’ve said before, you can’t blame them after the average quality of pitching competitions and the final outcomes. That said, that something is not well executed, doesn’t means it’s useless.

The problem with communication is that it takes time. Many attempt to create a “story” for their start-up and, except in rare occasions, they tend to fail miserably. They reason being, you can’t create a story if you don’t have the foundations first. What are the foundations of a startup pitch? Lets break them down into three stages.

Stage 1: Basic pitch structure

To make effective communications you first need to have a very clear idea about your product, your target customer and your business model. While it might be surprising, 90% of start-ups fail at this. As Dave McClure would say:

A ‘startup’ is a company that is confused about what its product is, who its customers are and how to make money.

While I do share Dave’s perspective, lets say that such confessions should be left out of your pitch. You need to project a powerful and secure message, which means, you need to be very convincing about what your product is about, who are your target customers and how are you going to make money. You might understand that such concepts will change and you’ll pivot soon enough, but you need to start somewhere. I usually suggest to work with Guy Kawasaki’s 10-20-30 rule.

Remember that the goal of this stage is to cover all bases, to cover all the potential questions or doubts anyone in the audience might have. The first stage is madness for many, as they try (and fail) to push all their business plan in slide format. It’s just not gonna happen. This is way most start-ups struggle and end up throwing in the towel. Nevertheless, such stage is critical for the crafting of a story. Without this structure, our story will just sugar coat the pitch. What we really want is to use the story as the backbone of our pitch, not other way around.

At this point, the pitch needs to undergo a rinse and repeat phase. The first version will be long. Very long. Don’t worry, just make sure all the basic questions are being answered. Do some dry runs with friends and make sure they’re not confused or missing some basic information. Once that point is achieved, the goal is to reduce the time it takes to explain it. Extreme focus needs to be applied to remove superfluous phrases, slides or concepts that don’t convey any needed information. The process normally takes several runs to reduce the pitch to a decent time. I normally advice people to take it all the way down to four minutes, being five to six the typical amount of time you’ll be granted on a stage.

Stage 2: Adding metaphors

Once we’ve covered the basic ground, then and only then, we can start working on using metaphors to convey the message better. The goal is to find the right metaphor that takes a high-end complex or technical concept into the reality of the everyday Joe. We want to have anyone understand, at least, the basic problem-solution combo. The best inspiration will come from people you’ve pitched the start-up to before. Most people will give you fantastic examples: “Oh so this is like when you do X and you solve Y during your vacations”. The key here is to listen. Listen attentively to the people you pitch, they’ll give you the keys to building a great metaphor.

The best examples are the ones that emerge over and over again from different people. Search for those, search for recurrent emerging metaphors people use to describe your product and use them to your advantage. A word of advice here, if people keep bringing your competitors up, don’t panic, learn from it. Understand why they’re saying that and either rework your differentiation values or use such comparison to your advantage by getting one step ahead of the audience. With careful listening you’ll learn at what point in your pitch people start name dropping the competition. Outsmart them, say it yourself before they get to that point and add a carefully crafted differentiation message. It’s all about the timing.

Stage 3: Story crafting

The final stage picks up the metaphor we’ve been weaving before and takes it to the next level. The goal is to transform it into a living and breathing example that people can empathize with. Not only that, our intention is to use the story as a vehicle to deliver all the other basic points we worked out on stage 1. To do that, we need to take the metaphor and start humanizing it. That is, setup a credible protagonist, make is likable and similar to your audience and make it ride the metaphor, event after event, as if it had happened to him recently.

Remember that the story isn’t only limited to the problem-solution combo. It should reemerge at different points during the pitch, connecting problem-solution with market, competitors or technology. A frequent missing piece of most pitches is the call to action. At the end of the pitch you should remind people why your start-up is awesome, this is a perfect cue to end your story with an up-ending that delivers the final touch to the presentation as a whole.

Conclusion

Always remember that story crafting is an art and that as such, requires time. You won’t create a perfect story for your product in 30 minutes. You need to first structure your product, iron out any doubts, use examples, metaphors to illustrate and drive your points home and finally decorate the examples in a human way, with a story that makes people, not only understand it better, but remember it better.

This post and other examples are the reason why I’m writing a book on the topic. If you’re interested in collaborating or showcasing your own stories in the book, follow the newsletter and become a supporter. 

 Photo credit: http://500px.com/photo/27716399

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