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6 qualities that make a startup pitch stand out
Experience
In the last 3 years, I’ve seen at least 1,000 pitches.
Most of them were bad.
Some of them were absurdly good.
What made them so good?
Great question.
Today, I’m breaking down what makes a great seed-stage startup pitch.
The Observer Express
Don’t have time to read the entire post right now? No worries, here are the main points:
A great pitch is a great signal, a bad one is a bad signal. The quality of the pitch reflects effort, understanding, experience, and scalability.
Clear communication of the problem, concise Q&A responses, visually appealing slides, high-level focus, confidence in delivery, and prioritizing core aspects differentiate exceptional pitches.
The Easy Job
This week I worked with 10 entrepreneurs on their presentations ahead of an upcoming pitch event.
Admittedly, I have the easy job.
Offering commentary and a few suggestions is simple. The insanely hard part is distilling years of blood, sweat, and tears into a 5-minute block of time.
We’ll see how many of them take my advice.
As I worked with these entrepreneurs, I found myself reflecting on the following question: “What makes a great pitch great?”
I’ll answer that in a second.
But first, here’s why investors should care about the quality of a pitch.
In General
An excellent pitch is an excellent signal. A terrible pitch is a terrible signal.
Caveat: There are plenty of great investment opportunities shrouded behind an entrepreneur with poor communication skills that, with a little TLC, could be tremendously profitable. There are also terrible businesses hidden behind the cover of a great presenter with a compelling story (I’m looking at you, SBF).
But in general, I like to keep things simple: good is good, and bad is bad.
4 Qualities of Quality
Presentation quality signals at least 4 things to an investor:
Level of EffortPreparing a solid presentation takes a LOT of work, even for naturally gifted speakers. This suggests the individual is willing to do whatever it takes to take care of their business. In contrast, a poor presentation leaves me thinking “Gee, if they weren’t willing to put in the work to polish that up, I wonder what else in their business is half-baked?”
Depth of UnderstandingWe all want to feel understood. When an entrepreneur hits all the slides I’m expecting to see and crisply answers all my questions, I naturally feel comfortable. I think to myself “They get me.” In contrast, a founder who presents information to me in a way that I don’t expect or that is unfamiliar is sending the message that they definitely don’t get me. They don’t know what I (and likely other investors) expect to see, and that leaves me feeling very uncomfortable.
Volume of ExperienceAs the saying goes, “Practice makes perfect.” I generally want to see that an entrepreneur has some reps under their belt. I want to know I’m not their first rodeo. That inspires real confidence. Even if it’s a young company, the more time a founder has spent in front of investors or coaches the better because they’re likely to come face to face with questions and situations that force them to grow and think critically about the business. Think about it this way - would you rather schedule a procedure with the 1st time surgeon, or with the surgeon who’s done that procedure a thousand times? In the same way, I’d rather trust my investment dollars to the founders who have an absurd number of reps under their belt than the ones just getting started.
Ability to ScaleA CEO with the ability to clearly and concisely communicate his or her vision is a CEO who can scale with the business. A CEO that cannot will eventually need to be replaced. Simple as that.
Now, let’s talk about 6 things that I think make a presentation great.
6 Things that Make a Pitch Great
There’s a ludicrous amount of content out there about how to structure a pitch.
Here’s a link to my favorite video on the topic.
I won’t get into those details. What I will focus on are the 6 most common coaching points I dished out this week. See a presentation that checks all these boxes? I’d double-click.
Specific, Concise, & Personal (to the Entrepreneur) Problem What’s the point? No one really cares about the solution. All they care about is why they should care about it. The effectiveness with which a presenter communicates this is so, so, SO important. So many founders miss this. If you and I leave a pitch without a clear understanding of the problem, that’s the entrepreneur’s fault, not ours. This topic is so important that I recently dedicated two entire articles to it (see “What’s your Problem?” and “Why is that the Problem?" for loads more).
Q&A Breadth over DepthTied with #1 for the most common mistake is flubbing Q&A by getting too far into the weeds. The only part of the typical pitch that is not typically scripted or pre-arranged is Q&A. Everyone knows this. What an opportunity! Where entrepreneurs have a unique chance to shine (and where most don’t) is in that flexible Q&A space. But not if they only have time to answer one question. Far too often I see entrepreneurs get excited about one question and spend the entirety of their Q&A block answering it. Far better to prioritize breadth over depth, which does 3 things for them:1. It makes them seem more well-rounded because they’re able to address more questions about a variety of topics they couldn’t get to in the body of the presentation. 2. It makes them seem more confident because they’re clean and concise instead of rambly and long-winded. 3. It helps the audience connect with them since a greater percentage of audience members can ask their questions.
Great SlidesGreat content + bad slides = bad presentation. Great content + great slides = great presentation.The deck needs to look great. Pretty slides are table stakes. Founders who spend the time/money to make that happen are well-served. Founders who don’t are shooting themselves in the foot.
High Level5 minutes is not enough time. Neither is 10 minutes, or even 20 minutes. Great presentations skip the minute details, focus on the main points, and leave space for Q&A and follow-up conversations around the nuts and bolts.
ConfidentGreat pitches are delivered with confidence. Confidence is a powerful social signal that indicates to an investor “I know what I’m doing. Get on board or don’t - either way, I’m going to make this happen.” That’s compelling.
Keeps the Main Thing the Main ThingEvery investor pitch must be composed of, at a minimum, a clear problem (see #1), a clear solution, and a clear differentiating feature. Everything else is secondary. Great presentations nail these 3 things and leave the audience with a rock-solid understanding of each.
Final Thoughts
Assessing the quality of a startup’s pitch is a meaningful component of due diligence. While it’s not always the deciding factor on a deal, a well-executed pitch sets a company apart from the crowd.
What do you think?
What do you look for in a great startup pitch?
Weekly Observations: 3 Lessons Learned
ALWAYS order samples.📄This week I spent some money to order samples of the flyers I’ve been working on for an upcoming conference. Boy am I glad I did - they were close, but having them printed and on my desk made it VERY easy to identify small details that were off that I would have otherwise missed.
Cash flow forecasting = well worth the effort.📊This week we worked on a detailed cash flow forecast for the business. This effort has been extremely liberating because it has revealed where we do and where we do not have room in the budget for the variety of projects and opportunities we’ve been considering. As our bootstrapped business has begun to grow, I’ve found myself struggling to clearly understand what we can afford and when, so this effort has been fantastic.
Be different.👨💻At a networking event this week I met a very nice entrepreneur who runs a web development agency. I will never refer anyone to him ever. Before I tell you why, let me summarize the gist of our conversation: Me: “What kind of projects do you specialize in?” Him: “Oh, we do everything.” Me: “Ok, who is your target customer?” Him: “Oh, we’ll work with anyone.”Me: “Ok, what price range do you typically charge for the average job?” Him: “Oh, it depends on the project.” Me: “…”I walked away from this conversation deeply bothered by how undifferentiated this company was. In an effort to please everyone, he’s built a business that likely pleases no one. I have no idea what he’s good at or when I should send someone his way. Lesson learned: be different.
Weekly Links: 3 Things I Found Interesting
Thanks for reading, have a great week.
-Andrew
If you enjoyed this post, please share it with a friend, colleague, or anyone else who may benefit.
P.S. - I recently finished creating The Angel Network Toolkit: 90 Resources for Cultivating a Thriving Community of Pre-Series B Investors, and I’m sharing it with anyone who refers a friend.
How did I do this week?
About Me
I cultivate flourishing.
I'm also the CEO of PitchFact, where our mission is to cultivate flourishing specifically through efficient and collaborative early-stage diligence. I'm a proud husband, grateful father, and honest friend. My love languages include brisket, bourbon, and espresso.