After having suffered through many a bad presentation, and thoroughly enjoying some good ones, I have come to appreciate an effective one. But what makes an effective presentation? As F.L. Lucas said, “And how is clarity to be achieved? Mainly by taking the trouble and by writing to serve people rather than to impress them. “ Here are a few key points:
- Brevity is Bliss
A friend once asked me to sit through a presentation for an online dog food company. The Founder/CEO had spent nearly $2.5mm of his own money and was convinced this was the most important discovery since the theory of relativity. Two and a half hours into the presentation, after I had asked him multiple times to get to the point, I finally got up, politely told him I could not help him and left the room. Needless to say, he never raised any capital, and that’s because I am a heartless, blood sucking VC and banker! As William Shakespeare said, “Brevity is the soul of wit.” If you can’t articulate a business idea in 15-30 minutes, it is not worth pursuing.
- Know Your Audience
I once wrote a piece for CNN, which the producer completely altered before publishing. When I asked him why, he simply said, “You are not speaking to our audience.” It is very important to know your audience before presenting anything, to make sure you know their background and interest in the sector, existing experience or investment, level of technical knowledge and expertise, etc.
One of my good friends, the CEO of an enterprise-class security company, asked me to sit in an investor presentation. He spoke to the angel investors, as though they were the security officers of GM and BofA. Needless to say, it did not go very well. They wanted to know him, and that message did not get across. He also went on for over an hour, since such technical presentations require so much time for details!!!
Especially when you are pitching VCs, it is important to do the diligence to make sure they are interested in your sector, are currently investing, have dry powder, invest in your geography, do not have any competitive portfolio companies, focus on your stage, and write the check size you are in interested in. As Annie Proulx said, “I find it satisfying and intellectually stimulating to work with the intensity, brevity, balance, and wordplay of the short story. “
- Focus on no More than Three Points
Remember the scene in the movie Amadeus, where his royal highness complained about “Too many notes”. Well, that’s a common issue! There is such a thing as too much of a good thing. As Thomas Leonard said, “Clarity affords focus. “ Make sure people leave the meeting remembering the two or three most important points.
- Nobody Likes History Lessons
H. L. Mencken famously said, “A historian is an unsuccessful novelist.” Most people don’t like history lessons in presentations. If I do not know what you are talking about or the context, I will ask. During a presentation, I want to understand the ability of the presenter to communicate an opportunity, articulate an idea, and demonstrate powers of persuasion.
- Focus on the Team – Do Not Rely Too Much on the Idea
People invest in people, not ideas. One of the most key elements in the presentation is your ability to demonstrate a credible team, has relevant experience, and is committed, articulate, and has integrity and passion. There are many reasons why:
- The idea and company you start with will morph with time.
- There will always be mistakes and challenges along the way.
- Markets shift quickly and unexpectedly.
- If the idea and the market are indeed good, there will always be competitors with more money, resources, and access.
A smart, experienced team is one that thinks in an objective and thorough manner and can figure things out along the way, without falling in love with the idea itself, showing flexibility, agility, decisiveness, and maturity. That is what investors are looking for.
- Be Factual, Concise, & Clear
There are people in every venture capital firm that are paid to do extensive background checks on the entrepreneurs who are applying for financing. Don’t overstate. Make sure your information is accurate. Remember, facts are not elastic. Do Not Stretch Them.
Also, remember your assumptions are worth very little, without data to back them up. So be very clear, conscience and careful about explaining them and backing them up. As Marquis De Vauvenargues said, “Clarity is the counterbalance of profound thoughts.”
- Avoid These Amateurish Mistakes
These are the comments we do NOT want to hear in a presentation. No explanation is necessary!!!
- These are very conservative numbers
- There are no competitors
- The market is a trillion dollars, and we are going to capture 1% of it
- I do not like partners
- My idea is worth billions
- The company will sell for $500 million in three years
- Be clear about the opportunity and business model
We are all ADD. We are not going to waste time trying to figure out the details of your opportunity. If I have to ask you about your monetization mechanism or business model, you have lost me. So remember what Gotthold Ephraim Lessing said, “For me, the greatest beauty always lies in the greatest clarity.”
- Do NOT have ANY mistakes in your presentation
I recently received an e-mail from a young entrepreneur, who spelled my company name wrong, among other things. He was also 15 minutes late to the meeting. Not a strong first impression.
- Leave Them Wanting More
You do not have to open the kimono during the first meeting. Take it one step at a time. If you are doing well, make sure you leave something for the next meeting.As George Oppen said, “Clarity, clarity, surely clarity is the most beautiful thing in the world, A limited, limiting clarity I have not and never did have any motive of poetry But to achieve clarity.”