"The Elevator Pitch"
entrepreneurship blog – Post 5
Like many other things in life, making the elevator pitch is something you learn the hard way. Surprisingly enough, the “elevator pitch” doesn’t mean making small talk with the complete stranger we met in the elevator of an important investment house.
The elevator pitch is a bare bones summary of the business idea, the service or project you are offering the world. The logic behind the idea is to see whether you can interest someone in your venture or product in the time equivalent to riding the elevator in an average office building, let’s say 30 seconds, or 100-150 words. It doesn’t have to be exactly that time or that number of words, the most important thing here is the impact.
We should point out that mastery of the art of the elevator pitch is not only relevant to entrepreneurs. It’s a basic need for many professionals such as project managers, sales people, applicants for jobs and so on. In fact, these skills could also be useful in our day to day communications with others around us.
The elevator pitch is a way for the entrepreneur to examine his ability to put his idea across briefly and accurately, and to sell himself.
Our first steps as an internet venture were devoted to studying and acquiring knowledge, in order to define our method of operation as clearly as possible. This is an essential stage, involving Sisyphean effort over many hours, throwing up lots of ideas and examining them as possible business opportunities, and discarding most of them with a heavy heart. It’s important not to get caught up in a whirlwind of facts and figures. Masses of information that seem clear and persuasive to us may not appear to the investor in the same way. The best we can hope for is for the investor to come away with one clear message, and that is the one we need to focus on.
Once we felt we were ready with a short sharp message that would bring the investor leaping from his seat, we started arranging meetings with advisers and potential investors with whom we were put in touch by ISEMI School of Entrepreneurship.
With great enthusiasm we showed them our 15 minute presentation, and again and again, after a few seconds silence, the same questions came up: “So what exactly are you doing?” and “So just how are you different from the competition?” Each time we were astonished. What was happening? Didn’t these idiots understand? Or perhaps, could it be that in spite of all our hard work, we failed to put our message across? Were we speaking Chinese? Could it be that our venture dealing with design rather than high tech was so obscure for so many people? Did we speak too quickly or perhaps we didn’t give enough examples?
The answers were simpler than we thought. Our focus was simply wrong. Our presentation was a whole jumble or facts and figures about the market. We relied on our personal experience as designers, without taking a broader look at the benefits for the potential customer. Above all, we missed the main point that interests investors: how will this venture earn me more money!
After a few more (metaphorical) smacks on the face (see previous posts) we understood that a presentation to investors must summarize the idea in a few sentences, showing why it would be a good idea for the investor to put his money into the venture. How much money you can make for him, how you’ll do it (technologies, marketing, service, unique target market, your advantage in reaching him etc.), and how long it will take. The pitch must focus on one main message, without unnecessary distractions – who we are, why the business is unique and how it will make money (lots, and fairly quickly).
Once we understood this, we sat down again (for about the 62nd time!!!) in front of our “15 minute presentation”, we cut it down to the right length and worked on it again, but even so, in the next meeting we discovered we still hadn’t got to the bottom of it.
The really clever bit is to put the message across in a creative way that will stimulate the investor’s interest/ appetite. On this point, it’s best to take advice from people with lots of business and marketing experience, particularly with start up entrepreneurs.
A few tips for creating your pitch:
1. Opening sentence: this is the sentence that must catch the investor’s intention and make him really listen. Try to isolate a single intriguing element of the venture and make it your opener. This sentence could also come in handy for chance meetings with people at events, you never know where you’ll find a useful connection.
2. Simplicity: stick to one clear main message, and keep it short.
3. Practice: write down the guidelines for your pitch, polish it and work on its precision, then practice delivering it. Try it out on your partners and professional trainers and mentors. Record it, if possible video it, so you can study not just what you’re saying, but your body language, how you put the message across. This is like any performance, so the more you practice the better the result will be.
4. Emotions: your entrepreneurial passion must be reignited every time. An observer can quickly tell if its authentic or not. If your presentation links to your vision it will come over as honest, truthful and exciting.
5. Fashionable buzzwords: the use of “in” words and expressions such as Web 2.0 and P2P platform is important. Many of these are quite vague, but using them is an essential item of the social and professional life of people in an industry. Potential investors read in the financial press about a wave of offerings from Web 2.0 companies. They don’t always know what the service means, but it sounds familiar.
6. Help: outside help is essential. You need professional feedback to polish your message, but remember that the message must first of all reflect the spirit of the entrepreneurs. Otherwise it won’t work!
There’s more to come…
