Perfecting the pitch with note slides
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How to make an effective presentation, focusing on investment pitches. Presented by Ken Berkun to the Hawaii Inventor's Association on September 24, 2013.
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Perfecting the pitch with note slides
- 1. KEN BERKUN, PRESIDENT LABELS THAT TALK BERKUN@SOUNDPAPER.COM Perfecting the Pitch Includes notes. (Slides labeled as notes are for previous slide.)
- 2. •Me • Experienced entrepreneur • Technical background • Successfully raised both Angel and VC funds • 1 Successful exit • Working on startup #2 now •You • Who is in the audience Introduction
- 3. • Fundamentals of Being in Front of a Group • Presentation Techniques • Prep Work • PowerPoint Tips • Props • Demos • Investor Pitches in particular Topics
- 5. •Forbidden Words •Face the audience •Speak slower •Speak clearly •Empty your pockets •Never lie / Never make up an answer •It is fine to say “I don’t know” •You can always say “I’ll get back to you” Fundamentals
- 7. • Verify in advance that the right A/V gear will be available • Arrive Early/Set up early • Bring your own gear as back up • Sweet talk the admin • Bring your cards • Have your partner take notes • Dress appropriately • Be polite – no matter what Prep
- 8. Presentation Checklist Laptop √ Memory card with presentation √ Presentation is on Laptop Handouts Business Cards Notepad Pen If you have a Mac then video cable Props Demo Gear Extension Cord Special Cable 1 Special Cable 2 Meeting Checklist
- 9. • Understand exactly why you are there • Establish how much time you have • Take control of the room • Bring a clock you can easily read • The founder MUST present • Never interrupt each other More Fundamentals
- 10. Practice
- 12. • Limit and manage the questions and answers • Only jump slides if you have complete mastery of PPT • Don’t get lost trying to find the right place How to Handle Questions When Asked At The End
- 13. 1. Tell them what you are going to tell them 2. Tell them 3. Tell them what you told them The Classic Approach
- 14. Practice
- 15. •Use Guy Kawasaki’s “10/20/30 Rule of PowerPoint” • Ten Slides • Twenty Minutes • Thirty Point Font •All pictures • No Text PowerPoint Notes http://blog.guykawasaki.com/2005/12/the_102030_rule.html 10 Point 20 Point 30 Point 36 Point 36 Century Gothic Arial Times New Roman Calibri
- 16. •Animations are controversial • Keep them to a minimum •Video has a tendency to break •Audio is dangerous •None of these work on paper, on Slideshare, Webinars or anywhere else. Special Effects
- 17. • NDA • Buzzwords • Never apologize • Tons of text • Read the text • Looking at the screen not the audience • Lots of animations • Annoying transitions • Constant fussing and backing-and-forthing of slides • Lots of fonts What NOT to do
- 18. • Passion • Stealth • Curated • Ecosystem • Drinking the cool aid • Traction • User Experience • Killer App • Cloud • Disrupt • MVP • Drill Down • Action Items • Hockey Stick • Game Changer • Reach Out/Ping/Circle Back • Patent pending • First mover advantage • All we have to do is get 1% of the market • Pivot • Gamify • Viral • Epic • Crush it • Leverage • 800 pound gorilla • Fremiumum • Social Media • Open the kimono • Lean • Agile Buzzword list
- 19. •What you say is far more important than its appearance •Nonetheless, don’t be an amateur •Keep it simple and uncluttered Design v. Content Always credit your sources http://www.behance.net/gallery/Good-Design-Bad-Design/5466385 Why Design is Important!
- 20. • Never ever read • You know your story – so tell it • If you don’t then you are not ready • Notes in your hand are bad Memorization ON
- 21. • I say make it funny • Stories are better than jokes • Not everyone would agree • Cartoons are generally good • Keep it non-controversial • Always leave them laughing Humor But in any case, keep them entertained
- 22. Doing Without
- 23. •Demos always break •Screenshots are much safer •Never ever count on an internet connection •Nonetheless, nothing kills like a demo •If you do: • Short and Sweet • Show just the salient points Demos
- 24. • Do a trial close • Set the next steps • Start on Time and End Early • Know how much time you have • Ask • Know your audience - ask • Listen and react • Tell a story • Ask questions of your audience • And listen to the answers • Vary your voice level • Stay on topic Things You SHOULD Do
- 25. •You can’t say “I have passion” •You must demonstrate it •It is OK to show some emotion •But it is not enough About the “Passion” Word
- 27. •This is about the presentation •I assume you have • A business plan • A great team • A competitive edge (moat) • A great product or service •All you need is a little money… A Few Points
- 28. • Information • Contacts • Funding • Sometimes all you want is access to the right people Know Your Goals Flatteryisalwaysgood • Done right
- 29. 1. Problem 2. Your solution 3. Business model 4. Underlying magic/technology 5. Marketing and sales 6. Competition 7. Team 8. Projections and milestones 9. Status and timeline 10. Summary and call to action 10 to 20 Slides http://blog.guykawasaki.com/2005/12/the_102030_rule.html#ixzz2fZR0curu Lifted from Guy Kawasaki
- 30. •Two types of problems 1. Need 2. Want •How do you prove it? Problem Nobody knew we needed an mp3 player
- 31. •Your product or service •Screen shots or demo • But I don’t recommend demo •Customer quotes •Props Solution
- 32. • How do you Make Money • Clear business proposition • >= 40% margins • Advertising is tough • You have to prove you have a huge audience • Freemium has a terrible conversion rate Business Model We follow the Adobe Acrobat model – anyone can read Soundpaper for free, we charge a small amount for printing the barcode.
- 33. •You ALWAYS have competition •Even if it is just the status quo Competition
- 34. •Key positions only •Board or Advisory Board •Prior Successes •Pictures are optional Team Founder Berkun receiving the Governors Innovation Award in 2008.
- 35. •A little more about the product/service •Secret Sauce/Moat/Competitive Edge •IP Underlying Magic/Technology • Patent pending techniques for handling partial scans/missing data • Missing audio is easily filled in by our brains
- 36. •Marketing or Sales? •Understand the difference •Simply put: • Marketing is promotion • Sales are the deals themselves Marketing
- 37. •Have a realistic Plan •Cost to acquire customers •Average sale size •Margin Marketing and Sales Plans Viral is not a marketing plan
- 38. •Product Status •Traction! Sales! Contracts! •TRUTH! •Promise less deliver more Milestones
- 39. •Projections: • Not too big and not too small • Probably includes a hockey stick • State your assumptions • And your willingness to defend and adjust them • You MUST have model/spreadsheet • Of course it will be wrong but it is a starting point Projections
- 40. •What is the raise? •Simplified terms •Dates •Lead Investor •Trial Close Summary and Call to Action
- 41. Investment Summary Valuation: Current Capital & Debt Structure Founder(s): $850,000 Other Investors: Friends, Family and Angels Debt: $100K Sweat Equity: 8 Years Pre-Money Valuation: $8 Million Post-Money Valuation: $12 Million General Information: Name: Labels That Talk (LTT) Amount: $4 Million Series A New Securities Offered: Common Prior Rounds: Convertible Debt Lead Investor(s): None Expected Return Expected Company Values 12 months: $33 M 36 months: $80 M 60 months: $170 M Special Terms or Conditions: None Bogus Numbers
- 42. •Every audience is different •Do your research •How does your product help the people in this room •Stay at the appropriate level • 10,000 Feet Customize the Presentation http://navfund.com/blog/the-angel-bubble-or-why-i-would-rather- be-a-vc
- 43. Dealing With Spreadsheets Pro Forma Balance Sheet Assets Current Assets Year 1 Year 2 Year 3 Year 4 Year 5 Cash $ 58,205 $ (477,452) $ 3,431,674 $ 5,740,072 $ 12,454,939 Accounts Receivable $ - $ 98,775 $ 391,217 $ 785,479 $ 1,465,313 Inventory $ - $ - $ - $ - $ - Other Current Assets $ - $ - $ - $ - $ - Total Current Assets $ 58,205 $ (378,677) $ 3,822,891 $ 6,525,551 $ 13,920,252 Long-term Assets Accumulated Depreciation Total Long-term Assets $ - $ - $ - $ - $ - Other Assets Goodwill $ 1,200,000 $ 1,200,000 $ 1,200,000 $ 1,200,000 $ 1,200,000 Total Other Assets $ 1,200,000 $ 1,200,000 $ 1,200,000 $ 1,200,000 $ 1,200,000 Total Assets $ 1,258,205 $ 821,323 $ 5,022,891 $ 7,725,551 $ 15,120,252 $ (197,953) $ (287,888) $ (377,256) $ (509,088) $ (735,921) Liabilities and Capital Current Liabilities $ - $ - $ - $ - $ - Accounts Payable $ (42,047) $ (104,655) $ (194,889) $ (273,318) $ - Current Borrowing $ - $ - $ - $ - $ - Other Current Liabilities $ - $ - $ - $ - $ - Subtotal Current Liabilities $ (42,047) $ (104,655) $ (194,889) $ (273,318) $ - Long-term Liabilities $ - $ - $ - $ - $ - Total Liabilities $ (42,047) $ (104,655) $ (194,889) $ (273,318) $ - Investment $ 340,000 $ 640,000 $ 3,640,000 $ 3,640,000 $ 3,640,000 Paid-in Capital $ 1,440,000 $ 1,440,000 $ 1,440,000 $ 1,440,000 $ 1,440,000 Total Invested Capital $ 1,780,000 $ 2,080,000 $ 5,080,000 $ 5,080,000 $ 5,080,000 Retained Earnings-beginning $ - $ (281,795) $ (866,134) $ 515,036 $ 3,427,957 Annual Earnings $ (281,795) $ (584,339) $ 1,381,169 $ 2,912,922 $ 7,348,216 Total Owners Equity $ 1,498,205 $ 1,213,866 $ 5,595,036 $ 8,507,957 $ 15,856,173 Total Liabilities and Capital $ 1,456,158 $ 1,109,211 $ 5,400,147 $ 8,234,639 $ 15,856,173 Key ratios Year 1 Year 2 Year 3 Year 4 Year 5 Return on Equity -19% -48% 25% 34% 46% Return on Assets -22% -71% 27% 38% 49% Profit Margin n/a -115% 32% 31% 40%
- 44. Tempting, but don’t do it Pro-Forma Projected Annual Profit & Loss 2012 2013 2014 2015 2016 Year 1 Year 2 Year 3 Year 4 Year 5 Revenue 0 508,875 4,307,458 9,548,532 18,411,220 Marketing 6,500 156,630 498,439 986,887 1,076,717 Sales 8,850 116,670 259,300 510,650 755,800 Engineering 210,000 628,400 1,277,050 1,763,661 2,635,296 G & A 56,445 191,514 686,249 1,805,917 2,638,459 Sub-Total: Operating Expenses (281,795) (1,093,214) (2,721,038) (5,067,115) (7,106,272) Income (281,795) (584,339) 1,586,420 4,481,418 11,304,948 State and Federal Tax 0 0 (205,250) (1,568,496) (3,956,732) Income after Tax (281,795) (584,339) 1,381,169 2,912,922 7,348,216 Net Profit Margin 32% 31% 40%
- 45. Select Just One or Two Charts (5,000,000) 0 5,000,000 10,000,000 15,000,000 20,000,000 2012 2013 2014 2015 2016 Pro-Forma Revenue & Income Revenue Income $18,411,220
- 46. Bad Chart! Naughty Chart! http://www.biostat.wisc.edu/~kbroman/topten_worstgraphs/ http://lilt.ilstu.edu/gmklass/pos138/datadisplay/badchart.h tm
- 47. •The Valuation •Future Rounds •The Exit Dangerous Topics $0 $20,000,000 $40,000,000 $60,000,000 $80,000,000 $100,000,000 $120,000,000 2013 2014 2015 2016 Year 2 Year 3 Year 4 Year 5 Proforma Investment Value 3 times earnings 5 times earnings 10 times earnings
- 48. •Strictly optional •Now it is typical to email the presentation •Provide at end not earlier •Use PPS file and PDF not PPT or DOC Handouts
- 49. •1- to 15 Minutes is perfect •But sometimes you only have 3 • Or 2 •Practice your time • Then practice some more •Know what is important and what you can drop • It’s probably not as important as you think Time
- 50. • Sales • Beta Customers • Contracts in negotiation • Money raised already • Money of your own • Quit your day job • Your Board or Board of Advisors • Publicity • Website • Registered Copyright on your name Proof of Commitment – Prior to Pitch
- 51. •Sit down • Or stand up •Start and manage the discussion •Know what you want and ask for it •Ask lots of questions •Don’t be afraid of tough questions • Make sure you have answers • Never dodge the question After the Pitch
- 52. •How does that sound to you? •Is this the kind of deal you do? •If I could do that for you, would you invest? •If I can fix that problem for you would you be interested? •Is this deal size appropriate for you? •It looks like you really like this. Is that true? The Trial Close
- 53. •Trial Close •Next Steps •I will provide you with… Wrap Up
- 54. •Yup. Yes it is. •Tough. No one ever said it was easy. •The odds are NOT with you. •But mostly everyone is rooting for you This is a lot of stuff to learn
- 55. • Toastmaster • Incubators • Mentors • Founders Institute • Meetup.com • Dale Carnegie • “How to Win Friends and Influence People” • Edward Tufte’s books (any) • Nice write up of Buffer’s journey here: http://open.bufferapp.com/the- slide-deck-we-used-to-raise-half-a-million-dollars/ Resources
- 56. Slides are Available on Slideshare: http://www.slideshare.net/kenberkun/perfecting-the-pitch- with-note-slides Thank You
Editor's Notes
- The title is a complete lie. The pitch is never perfect, you can only hope to improve it each time.
- Old fart, 36 years in the industry13 years with DECFirst startup when I was 27 failed, but I paid out all debtsPrevious company was Singingfish.com the world’s first audio video search enginePrior to that I worked at another startup that lacked focus and burnt through more than $100 Million!
- You have to be comfortable talking to groups and individuals if you are going to run a venture backed company. It is a requirement there is no way around it.
- Certain words are forbidden: basically, soI first wrote “slowly” but changed it to slower. Whatever you are doing slow it downClearly I have trouble with theseJump up and down. You should not jingle.Getting back to you is good – it locks in the next meeting
- If you’re not 10 minutes early you’re 5 minutes lateIf in doubt over dress, it shows respectDo not be afraid to call ahead and verify everything.Keep a checklist
- Or you must have a very good reason why founder is not available.It has taken a long time but my partner and I rarely step on each other any more, but we did at the beginning!You will not always get your point in, but that’s ok, they won’t remember everything either
- Questions are goodBut keep controlDo not be afraid to cut off people with long questionsAnswer what you need to onlyIf at some point you have to say “no more questions” then do so.I just witnessed a presentation where the presenter went off on tangents and prevented more meaningful questions from being asked.
- But they can still only hold so much so save the really important stuff for last. But say it 3 times.Another meaningless diagram
- Practice answering questions – get your friends to help
- You can see right away I am breaking all these rules.That’s because I am teaching a class not making a presentation and those are two entirely different things.These are all the fonts you’ll ever needLocal boy made good.
- Audio is particularly important to LTT and we go to great lengths to make sure it is going to work
- The screen is just additional info for the audience who is really there to listen to youPick one transition, make it simple and stay with it.2 fonts per slide max. maybe 3
- Just for fun, the list is endless
- There is a trend to move away from bullet lists – this is good if you can do it. I haven’t succeededIt’s fine to borrow graphics but don’t pass them off as your own unless they are.Its easy to find examples of bad designHire a designer if you can afford it, they are worth it.And while you’re at it – grammar and spelling also matter.
- How much you memorize is up to you. I can’t memorize so I use the slides as a hint and paraphrase each one. I don’t recommend pure memorization, questions can through you for a loopBe prepared for extemporizing
- When you pitch at an angel meeting you are the entertainment.
- Can you do the presentation with no slides? Yes and sometimes this is the right thing to do. But in any case you should know your material so well that you don’t need slides.There was this time in Singapore, see…
- Think real hard about a demo. It must be shortNo detailsNo distractionsOnly show what makes you unique or what goes POWI NEVER do a demo during a pitch. I will do one in a sit down meeting.
- Story:Why I invented Soundpaper.Be prepared to say “this is not what I am here to talk about” Let’s set another meeting for that.We always start a meeting by asking how much time we haveIf this is an event like an Angel meeting then you’ll know in advance
- Passion comes from being good at what you do.
- Not here to talk about business plan, funding details or types of funding, how much to raise, who to pitch and much more. I assume you have that nailed and this is about how to present it.
- No sweat.
- First meetings can be for information onlyOnly go for funding when you are good and readyApplies for both angels and VCsNo difference between pitching to angels or VCs that I can think ofYou are not always in it for the moneyI suppose “picking your brain” is a buzzphrase but people fall for it all the timeIt is ok to ask for a specific introductionThis may not be the right VC for you and you want to know who is.
- Guy K. says 10 slides but that’s hard to do. But not too many moreThere are many such lists, this is as good as any.Exact order is not importantSome situations have their own guidelines – if they do, they use them, sorry.You always have competition even if it is the status quoMagic/technology includes IP and IP strategy
- Everyone wants you to have a need but sometimes all you have is a wantHow do you prove you have a need when it is a new product?Only Steve Jobs knew that we did.Funders want to see a “need” It’s much harder to sell a “want”That’s why I talk about the medical uses of Soundpaper
- The investor is not there to be your friend, she wants to make money. How?Must state a clear simply business plan
- If you say you don’t have competition you will be laughed out of the roomYou’ll hear this a lot: use company logos instead of text whenever you can.
- I’m not big on pictures of team members but if you can show them in action, that’s good.
- Sometimes the moat is marketing but usually it is in the product or serviceThis is not an IP discussion, that’s a whole different presentation
- The challenge is to present this in a meaningful and concise way.If you don’t have a calculation similar to the one shown then you probably don’t have a serious business.
- Lies will come back to hauntEveryone expects a bit of optimism but nothing will hurt you more than not delivering what you promised.
- The important thing is the assumptions. If someone disagrees with your numbers you ask what they don’t agree with and modify the assumptions which provide new results.A recent presentation at a business plan competition had such small revenue that we didn’t believe it. They did not win.
- You are often given a format you must follow.The Hawaii Angels summary format squeezed on to one sheet. Old format.
- Same as a resume, everyone gets a different versionGuy K says 10K feet. Not too high and not too low.OK to dive down occasionally but don’t stay there!
- What NOT to doYou just can’t And you can’t apologize for them “I know you can’t read this but…” but you shouldn’t have shown it!
- Make them big and easy to read
- Valuation is very subjective and ultimately a negotiation with the investorFuture rounds are wishful thinkingThe Exit may never happen
- Time flies likes an arrow. Fruit flies like a banana.I hate practicing and I especially hate practicing the timing. But I do it anyway
- You will not be funded if you haven’t quit your day jobOh and by the way, you can’t pay yourselfWhat is a partnership or an alliance?Better to have a simple clean landing page than no website or a site with someone else’s landing pageNames are hard you’re allowed to change it as you go
- “I’ll get back” to you is fine
- If it was easy anyone could do it.You have to be crazy to build a business.The world is not shark tank. The vast majority of people want you to succeed. I’ve only met a couple of VCs who were real jerks.
- Join us at the Windward Entrepreneur’s Meetup on the 2nd Thursday of each month at Pinky’s in Kailua