Participating in business competitions is a great way to gain experience and secure debt-free funding for your business/product. The most common method of competition, aside from or in addition to a business plan, is an oral presentation or 'pitch'. However, there are a variety of pitching structures. Below are some basic guidelines regarding some of the more common pitch structures.
The Elevator Pitch:
An elevator pitch is a quick description of your business and/or idea in the time it would take to ride up an elevator. Presenting yourself effectively is an essential tool in the business arena. A well-planned elevator pitch can open the doors to success in your future endeavors. Ideas may be at any stage of development from creation of concepts or ideas to an established business.
The purpose of a pitch is to QUICKLY get the potential investor’s attention, let them know what you have and what you are offering to get them to say… “Tell me more!!”
Parts of The 90 Second Elevator Pitch: It is important to note each pitch differs based upon the context of the idea being presented. This pitch was based on a new product for the fishing industry. This is a template to learn from should be adjust accordingly. This template can also be found here.
- Introduction Hello, my name is __________________, I am the (title)__________________ of (name of company) _________________________________ , (power statement) eg: XYZ company was formed to give anglers a third hand to hold their gear to assist in catching more fish.
- The Product (the Rod Mate) is the only rod holder that enables you to hold your outfit above your waist and out of the water and elements. It has 5 holding applications built in; around the neck, the waist, behind the back, over the shoulder or pinned on the vest. It works with all type of fishing rods.
- The Market is huge. American Sports fishing Association reports that there are an estimated 44 Million US recreational anglers. The facts are more people fish than play golf and tennis combined. There are several other rod holders on the market but none have the features like the Rod Mate.
- Marketing Strategies (here is where you tell them how you are going to market your product. Eg: we are going to offer this product via Direct TV or infomercial. We plan on getting our product into 294 different medias within an 18-month period and then moving it into the big box retailers after that.
- The Raise This is when you tell them how much you need, how you are going to raise it and what they can make if they invest. This is the most important part of the sixty-second pitch. Eg: We are going to raise $300,000 and we are going to be doing a Revenue Purchase agreement with our investors. Simply put if you invest $10,000 in our venture based on our revenue projections you will get a return of $58,000 in 36 months.
- The Close If you are interested in learning more about our product or service please feel free to give me your business card and we will be glad to set up an appointment to talk with you more. (the goal is to set up a follow-up meeting)
Putting it all Together:
- Potential investor: “What do you do?”…
- My name is Gary and I own a company called XYZ enterprises and we are coming out with a new product for fishermen. This product is called a rod mate and it was designed to be a third hand for fisherman when they are fishing so they can catch more fish. It has 5 different positions you can use to hold your rod, behind your back, pinned to your vest, around you waist, over your shoulder or around your neck. Did you know that there are over 44 Million fishermen in the US alone and fishing is bigger than golf and tennis combined? And fishermen spend money. We are going to offer this via Direct TV or Infomercial advertising and will be in 294 different medias within 18 months across the US. After the product gets known throughout the US we will go to the big box retailers like Wal-Mart and Target for distribution. We are raising $300k in a unique funding strategy called revenue purchasing. As an example if you invest $10k your return based on our projections would be $58,492 in 3 years. If this sounds interesting to you give me your card and I would be happy to give you a call to talk with you more.
Remember, all pitches are different and the above example only covers one possible style of delivery. Some basic sample pitches can be found in the video below.
The Three - Five Minute Pitch:
More than double the length of an elevator pitch, the five minute pitch is a common time constraint at business competitions. Contestants are given five minutes on stage to ‘sell’ their company to potential investors, partners, and customers. Getting these presentations right can lead to financing, buzz and growth; getting them wrong does not. Unlike the elevator pitch, visual aids are allowed. Always review the rules for each individual competition carefully. Some allow physical props in addition to powerpoints, while others do not.
Before creating the presentation: review the company vision, goals and road map. Be honest with yourself. Is your company unique? Does it have big barriers to entry, a unique technology, or patent-able intellectual property? You can make a great and compelling presentation to influencers and VCs even if your company isn't a “one and only.” Be clear and candid about how your company will achieve success in the face of competition. Too often, presenters try to glaze over issues of concern. Your audience is bright and it’s best to proactively address foreseeable roadblocks your company may face. By doing so, you gain trust and build credibility.
Critical Questions to Answer During the Presentation:
- What is the company vision? It’s great if you can convey your five-year plan. However, at the very least, focus on communicating a concise, concrete vision for the immediate future and why it’s crucial for the current market.
- What is the problem being addressed? Without your product, how are people operating today and what’s wrong with the status quo? Use real world examples and sound bites that make your product memorable – such as “our technology takes the headache out of version control”.
- Where does your company fit in the market? Regardless of whether you offer a physical product, a software feature, application, or platform, you should candidly define that market reality, and present sales and marketing plans to back up your model. Why will you win versus the competition? If you win, who loses or what changes?
Be sure to present the facts. Include the overall market size for your product today; a list of competitors and differentiators; your basic business model (licensing fee, subscription, one-time fees, revenue share etc.); how much funding you've raised (if any); names of key team members and their micro-bios. For a review on the business model canvas, click here.
Be passionate. The most important thing you can convey to your audience is passion. Don’t lecture to them or read off of slides – tell your story with emotion and energy. Passion is palpable and will engage a room from the start.
- No competition (Everybody has competition! Never, ever attempt to claim that you don’t.)
- Jargon/acronyms (Treat your audience like an educated layperson.)
- Too many words per slide, with no graphics
- Unclear revenue streams (How will you make money?)
- Unrealistic projections
- Unjustified numbers (Don't fall prey to 'If I just capture 1% of the market…' syndrome. Do some research!)
- Reading notes or the slides (Look into the judges’ eyes.)
- Mistakes/misspellings on slides
Basic Slide Deck Outline:
- Title Slide
- Company Purpose (short and sweet)
- Problem (customer pain)
- Solution (value proposition to customer)
- Why Now (industry overview)
- Market Size (who and where are your target customers)
- Competition (honest comparison)
- Business Model (a very basic explanation of how you will make money)
- Customer Acquisition (simplified marketing/sales plan)
- Team (founders and prominent advisers)
At pitch events, you have just five minutes to stand out from the other presenting companies. Take advantage of your short window of fame by telling a memorable story with passion. The best company pitchmen aren't salespeople. They’re great storytellers.
The Ten - Fifteen Minute Pitch:
While you might be able to get away with winging it during a shorter presentation, practice is the key to conquering the ten to fifteen minute pitch. The extra time allows for more elaboration on financials, and provides an opportunity to tell a compelling story. However, it can also lead to presenters rambling. Powerpoints should contain minimal text. This will keep attention on what you are saying. Copious amounts of text prompt viewers to read, which reduces their cognitive ability to focus on what you are presenting. The Question & Answer section plays a vital role in the pitch (see section below).
Basic Slide Deck Outline:
Company Overview (tell a story, where did you start, how did you get here etc. keep it short and sweet.)
Problem (customer pain points)
Solution (your product's value propositions based on pain points)
Why Now (industry overview and/or trend you are capitalizing on)
Market (who and where is your target market, size and potential, include TAM, SAM, and SOM)
Competition (how your product 'stacks up' compared to other products--main differentiators)
Go to Market Strategy/Revenue Model (what channels will you use, pricing, customer acquisition etc.)
Financials (be sure to include break-even points, primary costs, and basic projections)
The Team (founders and advisors, include any skill gaps and plans to address them)
Wrap Up (concise review of the most important facts presented)
Next Steps (include 'ask', use of funds timeline, deliverables, etc.)
Thank You (include contact information)
See 5 Minute Pitch section for more tips on presenting.
The Question & Answer Session:
Some competitions do no allot any time for questions. However, a majority of mid-to-long pitches are accompanied by a Question and Answer session. This time slot can range from 2 to 25 minutes, and is an extremely important addition to any presentation.
Don't think of the Q&A session as separate from the pitch. By anticipating the types of questions judges are likely to ask, you can strategically remove content from your pitch. This will allow you to maximize the total time allotted. For example, during a mid-to-long pitch it is expected that you will cover financial information. Be sure to include a general financial overview slide with a sampling of important facts (break-even units and dollars, primary costs, pricing etc.) but don't go into great detail. Anticipate that the judges will ask you a followup question regarding financials during the Q&A session (be it projections, profitability date, etc.) and prepare a detailed response. To augment this, you may create slides containing more complex financial charts in your slide deck's appendix. The appendix is a group of slides located after your final slide in your pitch deck. The appendix is not shown during the allotted pitch time, but can be shown/referenced during the Q&A session.
- Know your facts and be able to state them under pressure. The judges are likely to throw an easy question or two at you, be sure you can answer them clearly and concisely. The less time you take on 'easy' questions, the more time you'll have to answer more interesting ones.
- If you don't know the answer to a question, don't make it up. BS is easy to spot on stage and will likely destroy your chances of being taken seriously. Admit you don't know, but concede that it is a good question and that you will devote time to answering it after the competition ends.
If you would like to practice your pitch, need someone to edit your business plan, or would like general business advice from individuals who have competition experience, check out the GVSU Center for Entrepreneurship and Innovation! Swing by the CEI office located in the L. William Seidman Center between 9 and 5, Monday thru Friday, for help.