Last week I attended a lunch that was very generously hosted by a large Venture Capital Company. This lunch was for founders and was facilitated as a way for Founders to network with Potential Investors.
As a founder of a #startup , I am so grateful that events to match Founders with #investors exist, and over the course of this year I have attended some amazing #events . I have met some incredibly inspiring people, I have introduced myself to names I had only ever seen in Forbes Australia, and I even was lucky enough to get my foot in the door and have meetings with people who had the power to help me grow my company beyond my vision!
But attending so many “networking” events has also made me privy to a more “underground” movement. A #community of people who whisper in the corners, who complain to their loved ones, and when they feel they are in a circle of trust, let you in on the nucleus of this movement….
What is this you ask? A corporate takeover? A secret mission to sell secrets to media publications? No. It’s nothing as shady as that.
The secret is that there is not a Founder of a #startup alive that enjoys #pitching .
As Founders, we work so hard behind the scenes to build our businesses that we know will make great changes in the world. We spend days and night’s brainstorming, fill notebooks with scribbles of ideas, and have to scrape calluses off our fingers from overusing calculators to work out budgets.
Our eyesight is ruined from hours of staring at computer screens, we don’t sleep well due to the drainage of melatonin from all our Zoom Meetings, our skin has turned grey from the lack of sunlight and lack of nutrients as the only food we consume while survival eating usually comes in a packet or is microwaved…
And this is just the first 6 months of building a #startup…..
If you are a #founder that plans to #raise funds to help get your startup off the ground, or to scale your business, you need to have a Pitch Deck. For those who are not familiar with #pitchdecks , a pitch deck is a VERY condensed overview of your #startup , where you need to explicitly define the problem you are solving, how many people will use your solution, and how much money you plan to make your Potential Investors.
I personally am on version 16 of my pitch deck for Suggesterfy. I have created and edited it so many times that even when it shows up as an icon on my desktop, I start to sweat and get feelings of PTSD.
These Pitch Decks will be sent to Potential Investors, in the hopes that the Potential Investor reading it will be so inspired by your 10-PAGE PDF, that they will make time in their impossible schedules to have a meeting with you.
Those Founders lucky enough to secure a meeting time are then put through a “shark tank” type interview where they are given the opportunity to “pitch”. The same theatrics and same script will be re-enacted for each and every Potential Investor meeting, naturally with a few “tweaks” so that the story is appealing to the listener, but always with the same passion and excitement as the first time.
After the “pitch” is done, the Founder will then be asked a myriad of questions, a kin to a prisoner in front of a death row firing squad. The answers to these questions will determine, if:
The business idea is a good one.
Well, I haven’t even told you about all the preparation that goes on, behind the scenes, before the Founder even gets to the stage of sending their pitch off to a Potential Investor.
Cap tables drawn up, term sheets drafted, networking events to meet Potential Investors, creating spreadsheets with contact details of the people you met at said networking events, research into potential investors’ previous fund rounds, due diligence on Potential Investors…..the list goes on.
Are you tired yet?
I know as the Founder of a Startup, I am.
I am exhausted.
Investor relations and #pitching is a FULL. TIME. JOB.
If you are a #solopreneuer, which I am, or you have a very small #team , which most startups do, it doesn’t take a genius to see that all of this “Investor Stuff”, takes the Founder away from focusing and working on, and in their business.
Now this article is being written by me, a #founder . Let’s just consider all of this from the #PotentialInvestor’s point of view.
The Potential Investor has a very stressful existence to begin with. Often they are a part of groups where they have to make the decisions of where other investors may invest their money. They are the risk-takers, the gamblers.
The Potential Investor will often back the wrong horse, put all the eggs in the basket of a donkey that will disintegrate over an issue as crazy as Founders falling out with each other, or companies that have grossly overestimated their product market fit.
There are the occasional stories about when a Potential Investor picks a winner. Where they made the perfect decision and backed a company like Canva, SEEK or Afterpay, but this is why those moments are referred to as “Backing the Unicorn”, because after all, #unicorns are mythical creatures.
So with this stress and responsibility on the Investors’ shoulders, imagine how they feel when they have to drop everything they are working on, to go to a #networking event to meet Potential Unicorns. More often than not they have to partake in small talk where both parties genuinely do not have time to discuss how the others’ morning has been, and then they are hit with the 10 second “elevator pitch”. (The #elevatorpitch is a two-three sentence on what your business does and what is the problem being solved. )
More often than not, during the elevator pitch discussion, the Investor will be interrupted incessantly by either other Founders who want their “elevator pitch” opportunity, or by colleagues attending the same event, who want to steal the Investor away as they believe they may have just met the next Unicorn-Founder.
No matter how well-meaning the Investor is, or how truly interested they may be in the person they are talking to, the social situation is anything but enjoyable.
After the net-working event the Investor will then high-tail it back to the office to spend the afternoon either sifting through “cold-outreach” emails, or holding meetings with new Potential Founders.
The meetings with the afternoon founders may well be interesting, and occasionally the Investor may have their “socks blown off” by an incredible pitch which truly will make worldwide changes and disrupt the entire business ecosystem. But for the most part the investor will hear many pitches, over and over again in the same, similar niche markets, with the same, similar problems aiming to be solved, and will have to ask the same “firing squad” questions.
So, as you can see both the Founders and the Potential Investors are tired. They are exhausted. The way things are being done is not #innovation .
It’s time to find a new way.
It’s time to #ditchthepitch.
With the business world being full of very clever, forward-thinking #entrepreneurs , how has this major problem of start-up inefficiency not been solved?
Is the solution to send a video of pitch? So that the Founder can record once, and show their full genuine passion for the problem they are solving, and then the Investor can just fast-forward or pause through the parts of the video that they want to watch?
Is the solution for each Founder to complete an online questionnaire before being given the opportunity for a meeting? Thus weeding out the players from the ballers?
I am too busy working as the #founder of my #startup to delve deep into how to fix this problem. But if anyone wants to #pitch to me the solution and how we can possibly #monetise it while making 10 times the initial #investment, I’d be happy to schedule a meeting……
Enjoy Your week,