Rating Qualities

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One Perfect Pitch

How to Sell Your Idea, Your Product, Your Business – or Yourself
Marie Perruchet | McGraw-Hill © 2016

Communication and media expert Marie Perruchet explains how to create the “perfect pitch,”
an “ask” that will resonate strongly with high-tech venture capitalists (VCs). She used to cover
VCs as a journalist reporting on Silicon Valley entrepreneurs. Now she’s a business consultant
who counsels entrepreneurs on how to secure investor funding. She understands what makes
Silicon Valley VCs tick, what they want to hear and what will motivate them to invest. Her manual
includes a comprehensive set of rules for entrepreneurs, although – in what is probably an editing
misstep – some of her illustrative examples don’t quite align with her pitch-building advice. For
instance, she says to end every pitch by asking for something, but she doesn’t ask for anything in
her “perfect pitch” example. Yet, she offers some good advice for entrepreneurs seeking funding,
and she provides an unusual and helpful section of counsel for pitchers for whom English is a
second language. getAbstract recommends her approach to anyone seeking better pitching skills.

Take-Aways
• Most technology entrepreneurs can’t communicate their business ideas or hi-tech development
plans to investors. They need a “perfect pitch.”
• Entrepreneurs should create and hone a story that resonates with investors.
• The emotional connection your stories make matters more than the wording you use.
• Great story pitches incorporate conflict, change and progress.
• These stories are short, clear and authentic; they have universal applicability.
• Great pitch stories affect listeners’ brain chemistry, thoughts and actions.
• A good story covers four necessary elements – “loss, struggle, failure and transformation” –
and shows triumph over adversity.
• The perfect pitch unfolds in three stages: “tell me, show me” and “sign me up.” That is, explain,
demonstrate and effectuate a transformation.

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 • Effective storytelling is increasingly in demand in the business world.
• Funding pitches should identify a problem, explain how you’ll apply the investment to fix it,
and convince funders that targeted buyers will love your solution or product.

Summary

What’s the Story of Your Start-Up?

Airbnb, the online marketplace and homestay network, has a valuation of $25 billion. Before it
succeeded, its founders had trouble coming up with the rent for their San Francisco apartment.
Then an upcoming design conference became so popular that all of San Francisco’s hotel rooms
sold out.

“No decisions are made, no products are sold, no partnerships are forged, no projects are
approved and no ships of state are launched based on a slide show of dry facts.”

To respond to convention-goers’ need for lodging, Airbnb’s founders created a website originally
called Airbedandbreakfast.com. They rented three airbeds on their lounge floor to travelers and
cooked breakfast for their guests – for $80 per night.

Can you tell a story about the firm you want to launch? If your start-up is already underway,
what’s its story? Whatever your tale, tell it well so it can help you secure start-up funding. Stories
influence people’s emotions and affect their brain chemistry in a way that shapes how they think
and what they do. Technology entrepreneurs can use the amazing power of stories to influence
venture capitalists (VCs) to invest in their companies.

Communication Skills

Unfortunately, few technology entrepreneurs know how to communicate their company’s stories
compellingly. Most tech entrepreneurs can’t explain clearly what their businesses do. Often, they
bury their listeners in indecipherable jargon.

“Hook your audience immediately by telling a story that is universal and that appeals to
our collective human condition.”

Entrepreneurs need to know how to pitch a VC successfully. Great pitches succinctly communicate
what potential investors need to know about your company.

Around the clock, every day, someone is pitching somewhere in Silicon Valley. If you’re an
entrepreneur who needs tech capital, you need to know how to pitch, which means knowing
how to tell your firm’s story. To create your “storytelling strategy,” embrace the elements of any
effective story: “loss, struggle, failure and transformation.” A compelling story shows triumph over
adversity.

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 “One Perfect Pitch”

Organize your story pitch along these lines: 1) Identify a common problem, 2) explain how your
product or service fixes the problem, and 3) communicate why your target market needs your
product or service. You may want to focus your pitch on the professional saga of your start-up’s
founder. Tell how, against all odds, your intrepid CEO may upend your industry thanks to your
amazing offering. When you fashion your pitch along these lines, you create a story parallel to an
archetypal Hollywood film: “the hero’s journey through periods of darkness to transformation.”
However you fashion it, distill your story to its essence – the problem that your offering fixes
and the important transformation it will generate. “Use clear, concise and easy-to-understand
language and avoid buzzwords or jargon, which can turn people off.”

“Your story needs to show how and why you are the best at executing what you promise.”

Great stories include a conflict component. Perhaps your product or service deals directly,
successfully and heroically with a major problem affecting a significant marketplace sector. Great
stories are “authentic and universal.” They must be specific and personal about the entrepreneur
while having the widest possible appeal. Great stories should be unforgettable, but brief. Venture
capitalists who hear your memorable, short tale need something they can retell to their corporate
partners – the decision-makers who will vote on whether to advance capital to you.

Pitch Components

Pitch formats vary. Prepare a one-minute pitch, a five-minute pitch and a 60-minute pitch. Use
the “one perfect pitch method” as a framework for developing each one.

“Don’t assume that it will be evident to people that your product is great and that they
will love it.”

First, every pitch needs three elements:

1) “Flesh out your stories” – Details make your story authentic. Refer to your “breakthrough
moments” – the events in your life that made you who you are. That will give impetus to your
product or service. Your passion in telling your story is as important as the story itself. The details
you cover should include “conflict, turning points,” “a resolution” and “sensory details.” Make your
story particular and definitive.

“A successful pitch will make people sit up and take notice. In those first few seconds, you
want them to look up from their smartphones, stop checking their email…and focus on
you.”

2) “Assemble your story in three acts” – Act I is the “tell me” phase you use to “set the stage”
for your story and pitch. This is where you hook your audience members, seize their attention and

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 create a crucial bond with the investor. Act II is the “show me” or demonstration phase. Let the
investor see what your offering does. The demo should “enlighten, educate, entertain, and, most
important, sell” to the investor. Act III goes for the sale by explaining how your proposal will make
money for its investors. Be sure they understand your business model, the expertise you bring,
and how your firm and its backers will make money. “Explain the more financial aspects of your
product or business and how you will execute with your team.” Offer a long-range vision.

“Your pitch should be customized to the person you are pitching. That means having a
keen understanding of the person…and being able to convey that within the first few
sentences.”

3) “Make your presentation transformative” – When you wrap up your presentation, don’t
leave your audience “in the dark.” Repeat your main premise and create a strong ending that
keeps them waiting to hear what you are requesting. Then provide a “sense of closure” with a call
for action that tells them exactly what you want, whether you’re requesting another meeting, a
connection, money, a position or business plan approval.

“The One-Minute Pitch”

Most venture capitalists are busy, easily distracted people with short attention spans. You must
gain their attention and interest quickly. The one-minute pitch achieves this goal. To develop a
one-minute pitch, compress your information down to the essentials. Don’t expect this to be easy.
You may work for months to create a strong one-minute pitch.

“Your pitch is your brand. You must be able to communicate it in seconds, in shorter
formats and across multimedia platforms.”

Sequence your one-minute pitch tactically. Open with several seconds of silence; that’s the best
way to gain your audience members’ attention. It communicates confidence. Use the next five to
ten seconds to state your name and what you do. Then “frame the problem” in about 20 seconds
by characterizing the commercial lack your product or service solves. Aim to finish at the 50-
second mark. Use the final ten seconds to ask the investors how you can help solve their problem.

“Don’t try to dazzle your audience with too many numbers. It will backfire.”

To pull this off, you must practice your one-minute pitch over and over until you have every
aspect of your story down pat. Barring a miracle, you will need to make your presentation more
than once. Don’t let this frustrate you. Making the presentation numerous times gives you the
opportunity to revise your pitch and make it better. This line of attack presupposes you can
explain your brilliant idea for a new product or service in a short amount of time. Figure out the
single thing that differentiates your offering from every competitor. Hone in on this singular and
essential aspect, and hit it hard.

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 Pitch Template

With a longer pitch, try this sample template: Introduce yourself. Explain your new product
or service and what it does in one or two sentences maximum. Engage the audience by asking
members to describe how they’ve tried to do something difficult which your offering makes easier.
“State the problem. Offer a single solution. State the name of your product or service.” Explain
why now is the ideal time to for your product. Explain why your company is credible. Then, make
your official “ask.”

“All professionals, from fresh graduates to seasoned veterans, need to perfect their pitch.
In Silicon Valley, we are in pitching mode 24/7.”

Whatever the specific contents of your pitch, its purpose is to showcase a better future that only
your product or service makes possible. Your story describes what you do, the reason you do it,
and how your product or service works. Create your story as a reporter creates a lead: “Focus on
the what, why and how.”

Securing Start-Up Money

Arranging for start-up funding from venture capitalists can be difficult. The chance of winning
support remains infinitesimally small, according to Jeff Clavier, founder and managing partner
of SoftTech VC, a Silicon Valley seed firm. He points out that, in 2004, only 50 to 100 start-up
entrepreneurs were likely to solicit funds from firms like his.

“If you make it too complex for investors, it will be even harder to explain to customers.”

Today, Clavier explains, entrepreneurs make as many as 2,500 to 3,000 funding pitches annually.
To clarify the odds against funding, Clavier says, “We only invest in four or five companies per
quarter, or 15 to 20 companies per year.”

“Unspoken Rules”

Securing start-up funding is an even more daunting challenge if you don’t follow standard
solicitation practices. These implicit understandings matter when pitching to tech investors:

• “Pitch in the morning, if possible” – Silicon Valley professionals start the workday early.
By 8 a.m., many have already been busy at work for hours. To get to Silicon Valley investors
while they are still fresh, present to them as early in the morning as possible.
• “Pitch from Tuesday to Thursday” – Monday is the day businesspeople use to catch up on
their work and to hold most of their meetings. Friday, they’re worn out from their workweek
and can’t wait for the upcoming weekend. Pitching to tired and distracted people is seldom
effective.

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 • “Pick a quiet spot” – Avoid crowded situations like hallways and commuter stations.
• “Ask if this is the right moment” – Do your best to learn whether the investors you’re
presenting to might be preoccupied with a recent problem – maybe bad business news or
something personal like a home break-in or a death in the family. If so, reschedule.
• “Pitch when you are at your best” – If you aren’t at full mental and emotional strength,
you can’t do your pitch justice.
• “Be positive” – Your excitement, high energy and passion will be infectious.
• “Show that you care about your product” – Let the investors know why you started your
business. Explain why it’s important to you. Ask your audience for their input.
• “Talk about your vision” – Your presentation is the time to share your “big picture.”
• “Exhibit confidence” – “In virtually every culture, and especially the Western world, we
equate confidence with competence,” says Tomas Chamorro-Premuzic, professor of business
psychology at University College London.
• “Do your homework” – Know everything about your product and how your business model
will function. Research your audience thoroughly. Don’t be afraid to ask if the investors will
pull the plug at the first sign of trouble.
• “Prepare for everything” – Anything that can go wrong will. Plan accordingly.
• “Channel your athlete’s mind” – Tap into the intensity of an athlete getting ready for
competition. “Practice, strategize, be imaginative and authentic.” Be ready.
• Quickly make your point – Don’t waste your investors’ time. Most VCs won’t lend money to
people who make them angry.

Your Pitch Checklist

You have done everything correctly to develop your pitch. The moment of your presentation to
venture capitalists has arrived. After careful planning and preparation, take a few final steps
before you get up in front of your audience: Prepare a printed copy of your pitch. Practice your
delivery, and practice it some more. Visit the location where you will make your presentation.
Become comfortable with the surroundings. If you can, rehearse your pitch in this venue. Try out
your personal presentation equipment in advance, as well as any venue equipment you may use.
“Know your surroundings.”

“Practice, strategize, be imaginative and authentic, and believe that you’re the person for
the job. There is fierce competition for investment dollars. Investors want to know that
they are funding a winner.”

On the day of your presentation, dress appropriately. Practice some more. Then deliver your pitch.
Focus on your goal of using a story to establish an emotional connection with the VCs so they
fund your business. Dry facts won’t connect, but stories will. Stories strike an emotional chord
with an audience. This has been true since humankind’s earliest days. People lose themselves
in stories, as novelists and film producers and short-story writers know. Stories can make an

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 enduring impression on your listeners, including venture capitalists. As the presenter, you are just
as important as your story. Combine your authenticity with “humility” for maximum “likability”
and the right results.

About the Author

San Francisco–based communications and media expert Marie Perruchet, a former BBC
journalist, counsels entrepreneurs on how to pitch for venture capital funds and angel investors.

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This document is restricted to the personal use of Vanessa Antonio Ortega (vanessa.antonio@ecopetrol.com.co)
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