Condensing your business plan into just 30 seconds might sound like an editing nightmare. But the elevator pitch is about expressing the basics, while intriguing investors enough for them to want to find out more. The best approach is to introduce yourself and then tell your audience the scale of your ambitions.
“We’re looking for a person or team that wants to change the day-to-day,” says Mark Tluszcz, CEO of Mangrove Capital Partners, the venture capital firm famed for being the first to invest in Skype. “We see 2,000 proposals per year and make between five and seven investments, so it’s critical that they captivate investors from the start and tell us how they are going to change the world.”
Other venture capitalists agree that unveiling an ambitious vision is the best approach. “Venture capitalists want to grow global businesses, not regional ones,” says Hjalmar Winbladh, founding partner of EQT Ventures and former CEO of gifting service Wrapp.
Winbladh says the best businesses are those that provide solutions to big issues. But being led by passionate entrepreneurs who understand their markets is also important. “In the first 30 seconds, I want to know what the issue is, how your company fixes it and if I can work with you,” he says. “So you’ve got to show me you’re passionate about what you do, that you’ve got the stamina to make it happen, that you understand the market from an international perspective and that you’re thinking big.”
A strong, 30-second pitch can hook an investor with a powerful idea, but they’re unlikely to land the deal there and then. Entrepreneurs are just making their first impression – and those watching are asking themselves whether they feel they could do business with that person.
“Early-stage investors don’t do ‘one-night stands’. It is incredibly rare that someone pitches and gets money on the spot,” says William McQuillan, a partner at Frontline Ventures. “Investing is a long-term business, so the investor wants to build a relationship and understand the entrepreneur over a series of meetings. So, instead of thinking about pitching your company, think about what you need to pitch in order to get another meeting with the investor.”
McQuillan says businesses should avoid talking about the complexities of their technology in the initial pitch, and instead focus on the overall plan for innovation. “If you only have 30 seconds, don’t pitch your company – pitch the problem you are solving and why you are passionate to solve it,” he says. “Investors are naturally curious. If you can get them excited about the problem you are solving, they will want to learn more.”
“One way to stand out is to say something surprising,” says Louise Doherty, CEO of PlanSnap, a social-planning app. “I say: ‘We want all of the world’s social plans to be made through PlanSnap.’”
Doherty, a graduate of the Techstars accelerator programme who has successfully courted angel investors, adds that entrepreneurs need to show their credibility. “Being able to say what others think about you makes you more credible,” she says. “We have paying customers, we’ve won Techstars, and we have seven staff members that want to work for us. All these things help.”
Adam Beaumont, private investor and CEO of telecoms business aql, believes it’s important to be clear about what you want – but remember that investors aren’t just there to provide money; many also want to be involved in the business. He says entrepreneurs don’t always spell out what they’re after. “I want to hear a clear ask for what they need and why – is it mentorship, money, access to a network and market? If I had £1 for every pitch I’ve heard where the entrepreneur forgets to ask the money question, I could probably fund a new startup,” he says.
Tim Mills, investment director at the Angel CoFund, suggests avoiding the worst mistakes by following the CRRISP acronym – concise, realistic, reasoned, interesting, simple and punchy.
“The two most common mistakes people make with elevator pitches are making unrealistic claims, or having rambling and incoherent narratives,” he says. “Saying it’s a £10bn market so we should easily win one percent of it, that there is no competition, or that you’ll go from £0 to £50m of revenue in three years, simply raises a red flag,” he says.
Colette Ballou, an entrepreneur, angel investor and partner at VC Cavalry Ventures, says she’s looking for businesses that can scale up and have the team to cope with growth. She agrees that the biggest mistake to make during a 30-second pitch is to lie, particularly when it comes to who is already backing the business.
“A great 30-second pitch shows me that you are credible and trustworthy, so please don’t lie about which investors are already on board – we all speak to one another, you’ll be found out,” she says. “Finally, be enthusiastic. This is your baby – everyone needs to know how dedicated you are to it.”
