A Founder Keeps Two Versions of the Same Pitch Deck

2022-09-22 original Startups

Let me introduce the episode with J, the Canadian entrepreneur I mentioned earlier.

One day, after J set up an office in the Bay Area, I stopped by to catch up, and we ended up chatting about our respective situations. We were talking about fundraising when J suddenly said, “Hey, Kuz, don’t you have two different versions of your investor pitch deck?” “That’s true!!!” — we both burst out laughing.

<J’s Story>

Back when he was still a graduate student at MIT, he put together a team and set out to start a company. This is the story of what happened when L, an engineer in the PhD program, built a prototype, and they took it to a well-known investor, K. J didn’t know much about this investor going in, so he just brought along the “safe” set of materials he had on hand — the one with numbers and a business plan written up.

K flipped through it, then hurled the whole stack of papers behind him. “Yeah, he grabbed the edge of the papers with his right hand and just — like this,” J told me, looking pleased as he acted it out. I still remember that.

K leaned forward and said to J, “This isn’t what I want to see. You’ve got a prototype, don’t you? Show me that first. And then show me the materials explaining the technology.”

J immediately pulled the prototype out of a bag in the corner of the room — at the time it was an ungainly thing about the size of an elementary school desktop (the finished product that came later was about the size of two smartphones) — and set it on the table. Then he pulled out the other set of materials from his bag, roughly written notes on “how great this technology is” and “how wonderful the world it would create.”

J succeeded in getting K to write him a check on the spot.

<Different Positions, Different Perspectives>

Suppose you’re an entrepreneur. Suppose the other party is an investor. That business model might be your prized possession, but to the investor it’s just one of dozens of pitches that come in every day.

Suppose your company is at a very early stage. If the other party is an investor who specializes in early-stage companies, you can narrow down the points you should cover to something fairly template-like.

But suppose the other party is, say, a newly launched CVC (corporate venture capital) or a business corporation. Their decision-making process tends to resemble that of a typical large company. In that case, the materials you show them will end up being the same materials they use to explain things to their own superiors, and those materials need to contain just the information that makes that explanation easy for them.

So even when it’s the same business plan, what needs to be conveyed differs depending on the audience, and some things come across easily while others don’t. In such cases, people often end up producing exactly the kind of “information-overloaded materials” I warned about elsewhere in this book. That’s inconsiderate to the other party. Rather than doing that, I think the right approach is to change the materials you present depending on who you’re presenting to.

The content of this post is an excerpt (original text) from the following book. If you’re interested, please pick up a copy.

The Shape of a Happy IoT Startup

Originally published in Japanese at https://clazytech.com/2022/09/1201/. Translated with LLM assistance and reviewed before publication.