What I like to see in seed pitches

by RohitOct 08, 2017 | insert_comment

You have been thinking about an idea, done your research, started hacking away at a prototype and now you want to pitch to some early-stage investors. But you are not sure what to present — at this stage, there are more unknowns than knowns so what do you communicate to the investors? Looking back at the hundreds of pitches, I want to lay out some rules of thumb gleaned from pitches that resonated with us overall — not necessarily that we invested in them but in terms of where we clearly understood the founder vision, thought process, their strengths, and weaknesses.

First and foremost, pitching at a seed/pre-seed stage means that you are in the business of selling dreams, period. You have a vision of how your product will shape the world and you have to weave a story and a narrative that takes the listener along on that journey. Keep it simple — if I can close my eyes and imagine the scenario being projected — that’s what you want. Common mistakes that I have seen are when founders hold back on this because they are afraid that it will come across as being too audacious. But audacious is what moves the needle, so don’t hold back on that. Also, vision is not that “I’ll take X% of Y market”. Successful companies are those that define their markets by identifying some key shift in market/technology they can ride on. (What Peter Thiel calls ‘the secret that only you know’ in his book 0 to 1). Pitch decks from AirbnB and LinkedIn are great examples to emulate. The latter is a Series B deck but still hugely instructional for earlier stages as well.

The second thing that you want to do is give a glimpse of your thought process — how do you analyze the information to make decisions, and deal with uncertainty. For me, a lot of these questions get answered by the way founders talk about their plans for near-term — next 9–12 months. What product they would build, what’s the GTM strategy, what’s the team they need to build, what they know about their market and what they need to figure out and what experiments they would run for that. Again, it is not the specifics but the approach is what I am looking for. Some founders confuse this for very elaborate business plans with complete revenue and expense projections that even mature companies will find it hard to project, let alone when you are pre-product-market fit, so it completely misses the point.

The next thing to consider is if you need to put this on a deck. Unless you are a consummate story-teller, my advise is to use a deck. There are a number of advantages to it. The process of preparing the deck will force you to think about your vision, your strategy, and will bring out your thought process for anyone you are selling to — investors, early employees. The other big advantage is that it helps you stay on the narrative when you are presenting your idea. Otherwise, it is very easy to be thrown off-track by audience questions. Also, practice your pitch with some friends/advisors — people who may not know your area but who will genuinely try to understand and in the process offer helpful suggestions.

If you have read the account of first ascent of Annapurna by the legendary climber Maurice Herzog, the parallel will seem clear. Herzog was not sure about the exact summit (amongst the many peaks in the range), and naturally he didn't know which ridge or face would take him up. But he had a goal, to scale Annapurna, and he had a plan that he executed on and iterated along as he encountered failures and discovered new routes. If you haven't read the book before, read it for the account of exceptional grit and craziness needed to reach the sky.