The power of the pitch cannot be denied, and for many entrepreneurs who participated in the recent Startup Weekend Cape Town event, the hard truths about what works and what doesn’t hit home.
The event is unique in many ways — most of all is that entrepreneurs and innovators have to convince fellow participants that their idea is a winner, and thereby gain their support and buy-in for an intense 48-hour process to refine these startup ideas.
Throughout the weekend the teams have the opportunity to develop and hone their business concepts with mentorship from seasoned industry experts. One such expert was Alex Fraser, head of business development at venture capital firm Invenfin, who spends much of her time engaging with entrepreneurs looking for funding for their ventures.
Through her time at Invenfin, Fraser has been exposed to hundreds of business ventures and startups seeking funding across multiple industries. She and event organiser Julian Parr shared some of their insights into how entrepreneurs can overcome common pitching pitfalls.
Parr explains that the three main judging criteria in the competition are: idea validation, business model and execution; all standard fare for the Startup Weekend events hosted in more than 200 countries worldwide. The insights delivered by Fraser and Parr are however, as applicable to real world startup pitching as they are to Startup Weekend events.
“Although the time allocated over the weekend is really limited, we still expect the teams to cover the basics,” says Fraser. “Basic competitor research and barriers to entry are key components that any pitch has to cover. Without addressing these issues, no investor is likely to give any credence to your concept.”
A focused presentation that clearly and concisely explains the business opportunity is imperative, which means that irrelevant information must be discarded. And it needs to be delivered in the time available – whether it’s the brief ‘elevator pitch’ given during a chance encounter with a possible investor, or within the constraints of events such as Startup Weekend.
“Be passionate about your work,” adds Parr. “If you don’t seem convinced, the judges definitely won’t be. And as far as possible prove that a market exists, with at least some idea of how you intend to roll out your strategy to capture that market.”
Apart from demonstrating the need for the business idea, Fraser suggests that it is also important to describe how the product or service is differentiated from the competition. A product or service that has no additional features or benefits for the customer over its already established competitors is not likely to catch the attention of investors looking to help grow a business and generate a return on investment.
“Obviously, a key fact that has to be gotten across is the level of investment required, and how that money will be used to grow the business and maximise the potential of the business,” says Parr.
A factor that may be considered a ‘soft skill’, but one that goes a long way to winning the confidence of investors or judging panels is the actual delivery of the pitch. “Practice, practice, and practice your presentation until it becomes second nature,” suggests Fraser. “Also, a clean and visually-appealing presentation goes a long way to retaining interest and looks slick. Conversely it is important not to pad your pitch or slides with irrelevant information which takes up time and distract the audience.”
Speaking before a panel or crowd is not something everyone is comfortable doing, but without honing your skills in this department it is always going to be difficult to make the breakthrough that could bridge the divide between a business idea and launching your startup.
*Image courtesy Startup Weekend Cape Town