By Mike Figliuolo
I’m fortunate enough to see a lot of cool business ideas — both entrepreneurial and “big corporate” in nature. While the people pitching the idea are passionate, smart, and excited, more often than not, the pitch itself sucks.
I’m not being bombastic or hyperbolic here. The pitches really suck. Bad. Terribly.
I’m not saying I’m the best pitch man either. I’ve made all of the following mistakes at one point or another. The good news for you is I’ve both learned from those mistakes and I’m willing to share what they are. More important, I have a few suggestions on how you can avoid making the mistake in the first place.
It doesn’t matter if you’re pitching your idea to a bunch of angel investors, venture capitalists, business partners, corporate executives, or prospective employees. If you make any of the following five mistakes, you’ll likely not get the funding, the contract, the signature, or the support you’re looking for. Without those things, your idea is going nowhere.
So strap yourself in. I’m feeling saucy today and you folks know I get reaaalllly direct and candid when I’m saucy… Think of this post as a bit of me kicking up to all you smart folks out there (to learn what I mean about kicking up, CLICK HERE to read a post on the concept). So here are the five reasons your idea pitch sucks (and how you can fix it):
You Don’t Have a Compelling Problem
People pay to have problems solved. I don’t care if the problem is boredom, inefficiency, poor decision making, or not being able to find your keys — problems sell. If your pitch consists of “people will buy our blidget because it’s cool and complicated and nobody else has ever created something like this before” then your pitch probably sucks and won’t garner much interest other than idle curiosity.
If nobody has done it before, the reason why just might be that nobody needs that kind of blidget. Clearly articulate the problem, who has it, and why they are willing to pay to have it solved. I’ve covered having problems before so GO READ THIS POST to get better at defining the problem. If you can’t clearly articulate the problem, your pitch probably sucks.
You Use Meaningless Numbers and Top-Down Estimates
If you find yourself saying “the market is 80 gajillion people worldwide and if we just capture one tenth of one percent of those prospective customers we’ll be gazillionaires…” you sound like a complete idiot. You’re telling me you’re lazy. You’re saying you haven’t put in the rigor of a solid bottoms-up analysis of your sales and economics.
Sure, you have to pursue big markets to get big payoffs but once you’ve established it’s a large, growing, profitable and attractive market, you need to shift gears to bottoms-up estimates. Figure out your conversion rates, sales cycles, etc. and figure out some more concrete estimates for growth. If your numbers are frivolous, your pitch probably sucks.
You Have No Idea How You Make Money
First I have to pontificate — if you come to me with an idea that states “we’ll make our billions off banner ads and Google AdWords” I’ll kick you out of my office so fast your head will spin. The only people who make bank on that stuff are Google and the gigantic portal players. Everyone else just buys Rolling Rock or Heineken with the money from advertising. There. I feel better now.
Anyway, if you cannot clearly demonstrate the cash flows through your business and why your product is worth buying, then your presentation sucks. If you want my money as an investor, you had better be able to tell me how you’re going to pay me back tenfold what I gave you. If I’m a customer, I need to know that you’re running a viable business because I don’t like when my suppliers go under. If I’m an employee, you’d better be able to tell me you have a business model that enables you to pay my paycheck. Suggestion: map out the cash flows. Justify your margins at every step of the process. Understand the price of substitute products. Build a solid financial plan. If you don’t, your pitch probably sucks.
Your Visual Aids Look Like Crap
PowerPoint is a great tool but unfortunately it’s like a ball peen hammer and many folks injure themselves when they try to use it. I cannot tell you how many times I’ve been in an audience of investors and heard the idea pitchman/woman say “Now I know you probably can’t read this slide out there in the audience but what it says is…” OH MY GOD ARE YOU LISTENING TO YOURSELF?!?! Why the heck would you put up a slide you KNOW people can’t read? If you don’t have enough sense not to do that, I’m betting you don’t have enough sense not to lose all my money as an investor. Also, if you have 62 pages of PowerPoint for a 15-minute pitch, I don’t think you can fail any harder than that. Seriously. One slide for every three minutes you’re presenting. Seriously. ONE FOR EVERY THREE! If your visual aids look like crap, are full of clip art, or are illegible from further than six inches away — your pitch probably sucks.
You Don’t Know When to Shut Up
There’s always Q&A at the end of a pitch. Treat it like a deposition. Answer the question and only the question. I have seen so many people pitch and when they get the first question, they spend 15 minutes answering it and taking us through a magical mystery tour of everything behind the idea when an answer of “We expect our conversion rate to be 11 percent” would satisfactorily answer the inquiry. Answer questions directly. If your audience wants to know more, they’ll ask. Audience members get incredibly frustrated with you when they have a question they never get to ask because you couldn’t shut your cake hole and you blathered on ad infinitum. Answer questions directly and succinctly. If you don’t, your pitch probably sucks.
Look, I’m not trying to be mean here. I’m trying to help you succeed. Take the above peeves and advice in the spirit of helping you avoid mistakes that are easily avoided. If you can’t get past the pitch, you’ll never get to the payoff. Consider this fair warning for the next time you go pitch your idea to the crowd. There’s no guarantee you’ll get a thumbs up if you avoid these problems but I can almost certainly guarantee a thumbs down if you do any or all of the above.
Mike Figliuolo is the author of One Piece of Paper: The Simple Approach to Powerful, Personal Leadership. He’s the managing director of thoughtLEADERS, LLC — a leadership development firm. An honor graduate from West Point, he served in the U.S. Army as a combat arms officer. Before founding his own company, he was an assistant professor at Duke University, a consultant at McKinsey & Co., and an executive at Capital One and Scotts Miracle-Gro. He regularly writes about leadership on the thoughtLEADERS Blog, read the full original post here.
Originally published: Dec 15, 2011