Written by: Dan Dragicevich
We’ve all seen it. And if you haven’t seen it, you at least know the infamous character of Michael Scott.
He’s a hot mess of hilarity, sarcasm, stupidity, CRINGE, and yet, we can’t look away…
Okay, so what does Michael Scott have to do with Venture Capital? Well, there’s a line in “The Surplus” episode where Oscar tells Michael that they have a surplus of $4,300 and it needs to be spent by the end of the day otherwise it’s deducted from next year’s budget. Michael, having no idea what any of those words mean, says to Oscar, “Why don’t you explain this to me like I’m an 8-year-old…” And then, just as you think he understands, he says to Oscar, with a perplexed look, “Why don’t you explain this to me like I’m 5…”
Even though it’s a hilarious scene from one of the greatest comedy shows of our time, there’s a lot that a founder, who is looking for their first institutional check, can take from Oscar’s experience with Michael.
VC’s don’t know your business as well as you so make sure you pitch it as if you are speaking to Michael Scott!
Founders are incredibly smart people, with incredibly large brains, who have incredibly smart ideas, and yet, their strengths can also be their greatest weaknesses.
As you prepare for your pitch, make sure you remember that VCs, at their core, just want to understand what your business does. To do that, be like Oscar, and speak to them as if they are 8, or hell, even 5 years old, and keep in mind the three tips and tricks below!
Tip #1: Understand Your Pitch Time
At Kerosene, we like to tell founders that a typical pitch should be no more than 10 minutes, which means that for a standard 13-slide deck you have 45 seconds per slide. Coming to terms with this should instinctively tell you to cut the fat and keep your talk track at a high level to avoid getting into the weeds.
Tip #2: Pitch Cadence
After learning about tip #1, founders tend to rush through their pitch and talk a million miles per hour. Remember, talking for 45 seconds straight is a LONG TIME and is more than enough to hit all the major points of a slide. If you rush your pitch I guarantee VCs will lose interest quickly – or at a minimum feel like they are in the middle of a storm. One way to avoid their loss of interest is to simply TAKE A BREATH between slides. Providing a 1-2 second pause not only allows you to gather your wind, but it allows the VC to ask a question, or to simply digest the information.
Tip #3: The Goal of the 1st Meeting is to get a 2nd Meeting… Not a Term Sheet!
With March Madness not too far gone, I think this statement is appropriate… SURVIVE AND ADVANCE! All you’re trying to do in the first meeting is get the VC to like you and understand your business enough that they want to meet again. You want to leave the investor thinking about you in their next meeting. The further along in the meeting process you get, the closer you get to a term sheet. However, if you treat every investor meeting like it could be your last you’ll likely progress to a term sheet seamlessly.
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