Venture Financing

How to Make an Effective Venture Presentation

by Terry Collison, Blue Rock Capital Management Corp.

 

This help-tool was prepared a venture capitalist and it provides you with some tips on how to make an effective presentation of your venture to prospective investors. To learn how to prepare it please see "8 Issues in 8 Minutes: How to Prepare and Effective Venture Fair Presentation", by the same author

 

The history of venture financing is littered with the carcasses of truly worthy companies that just never made it through financing.

That’s why I’m so dedicated to giving entrepreneurs the keys to a potential investor’s brain.

You must plan your pitch based on an awareness of how the investor is likely to be thinking

Then you must communicate to the investor that you intend to present your information in a way that will help the investor assess whether this opportunity represents a "fit" with the investor’s interests and capabilities (notice: I didn’t phrase that in terms of "whether or not this is a ‘good’ investment").

Finally, if there is a fit, you must indicate to the investor how you would be interested in proceeding ("As soon as the funding is committed, our company intends to do X, Y, and Z") and what the results might look like (here, a "qualitative" picture — industry collaborations, exit acquisitions, industry market-share percentages, etc. — can often be more useful than reams of "quantitative" info, financial forecasts, etc.).

So much for the content. You know the 8 key issues that have to be covered.

Now for the finesse part: the all-critical delivery of your message.

When it comes to making a presentation, the key mistake made by most entrepreneurs (and mere mortals as well) is that they practice their presentation by "saying it in their minds."

Only.

It’s fascinating to realize how rapidly one can do a presentation in one’s mind and, by contrast, how long it seems to get the damn words out when doing it "live."

Therefore, use a tape recorder, use your wife, use your dog or even use your bedroom mirror but DO THE PRESENTATION OUT LOUD and remember to WRITE DOWN YOUR START TIME AND YOUR FINISH TIME and then calculate the elapsed time.

Here are the facts involved with how long it really takes to do a typical presentation:
 

As an exercise, try identifying each of your slides by type (Type A, B, C, D, or E) and multiplying by the appropriate "typical" time requirement shown above. Hmmm.....

When I’m first organizing a pitch on my own, for planning purposes I figure on an average of 3 minutes per slide. Then I generally don’t like the arithmetic implications of my trying to pack so much info into the budgeted time. So (A) I decide to eliminate (or condense or combine) some of the slides, (B) I decide to change some of the slides from Type B (above) to Type C (the content of the slide remains unchanged; only the length of time I talk about it has changed), and (C) I re-figure the timing based on an average of 2 minutes per slide.

Then because I know I’m probably lying to myself, I DO THE PRESENTATION OUT LOUD and actually TIME IT (just as I am suggesting that you do).

When I do my own presentation out loud, I confront the fact that — smooth-tongued devil that I know myself to be — I still can’t make the words come out sounding like a normal person.

So I set off to practice.

My personal rule: I try to do a presentation at least half a dozen (i.e., six) times OUT LOUD.

It’s amazing.

This technique really works.

My very last piece of advice (to be re-read the morning of the presentation or incorporated into your presentation as a note that you will see before you start talking). It’s simple:

And, oh yes... as you proceed through your presentation, KEEP SMILING (this is called the "Figure Skater’s Rule).

You don’t have to look goofy. Just look pleasant.

Remember, you enjoy talking about this stuff because, yes, you enjoy what you’re doing.

With luck, your pleasant demeanor communicates to your audience (A) that you may be a decent guy to work with and (B) that they too might enjoy coming on board.

So here’s a large-print version that you can toss on top of the foils as a reminder:
 

Bear in mind that you yourself know so much detailed information about the industry that you naturally talk "at the margin" (because this is where, for you, the information and the distinctions are most meaningful).

But for folks outside the industry or (worse) for people who have just a little knowledge, it is critical for you to be clear and concise and focused and always organized and compelling in what you say. "Basic" is better than "fancy."

Remember, you will start your presentation with a clean slate. The bias is in your favor because the participants know that you wouldn’t be there to make a presentation unless your company had somehow been judged to be worthy of the opportunity to do so.

You can employ the time in any way you deem to be effective. But you get only one shot.

In this setting, details are your enemy rather than your allies. Therefore, use detailed info to buttress your "big picture" themes and the arguments in favor of the investment opportunity. Resist the temptation to use details as the fundamental building blocks of your presentation.

Your goal is not to have investors "sign up" at the end of your presentation. Your goal is actually "negative" goal. It is to prevent "bombs" being lobbed at you in the form of questions from the audience. Your "positive" goal is to motivate investors to contact you subsequently for a more serious discussion.

Whenever an entrepreneur "just talks," he or she is usually a true master of his or her field. It happens quite naturally. Go with this side of your personality.

Remember that you never get a second chance to make a positive first impression.

Here is one effective way to get listeners on your side by beginning with something sort of self-effacing such as

You’re on your way!