
How to Pitch Your Company - craigcannon
http://themacro.com/articles/2016/07/how-to-pitch-your-company/
======
balls187
> If you’re creating a new product or space (like Slack)

Weird example. Slack didn't create a new space. They created a new product
that entered a supersaturated space. Pretty much any VC would balk at a
company creating yet another chat application.

> You don’t need to mention your GPA or that you once worked at Google.

You don't need to, but it helps.

...

Here is all you really need: build a good [great] product, get [paying]
customers, get a little lucky. Other than the guy who got nixed from YCs HN
Crowd selected funding program, it's pretty rare to have those three
components and not get funding.

My cynical side reads this piece as an investor giving out, what appears on
the surface helpful advice, but in actuality mostly benefits the investor by
making their jobs easier by streamline the pitch process, so they can more
quickly evaluate deals.

~~~
ig1
You're thinking like a developer. You see Slack as a realtime chat protocol
and think there's already a million solutions.

You need to think about it in a business context. Pre-slack virtually no
businesses used realtime group chat.

Developers sometimes used IRC, HipChat, etc. and some corporates used
Lync/Skype For Business/Yammer but these were terrible solutions for the
majority of businesses.

Slack didn't succeed by taking marketshare from IRC, it succeeded by bring
real-time group chat to people who never had it. That was a new market with
real questions as to whether there was any demand for real-time chat among the
wider business world.

~~~
balls187
> You need to think about it in a business context. Pre-slack virtually no
> businesses used realtime group chat.

Um, BBM?

~~~
elliotec
Are you seriously comparing Black Berry Messenger to Slack? I had to Google
BBM, and laughed when I saw that because people in businesses did not use
Black Berry, or BBM, in any capacity even close to Slack.

I agree with most points on your original post though.

~~~
balls187
Straw man. I wasn't comparing slack's feature set to BBM, just refuting the
point that before Slack, barely any businesses used group messaging.

> Pre-slack virtually no businesses used realtime group chat.

BBM, Real time group messaging, used by businesses. It was popular long before
group messaging was popular.

Yes blackberry is now a joke, but there was a time when many businesses
provided employees BB for communication, and it's users loved BBM.

...

That comment also missed the point: Slack didn't enter a new market (the claim
from the referenced article), it entered a market that already was saturated,
and by having a better product, is winning in that market.

Hipchat, Campfire, Lync, et al, are all competing for the same customers that
Slack competes for.

Whether slack is better for businesses, or whether it was a direct competitor
to BBM, completely misses the point.

------
ScottBurson
> 2\. How big is the market?

"If you know how big the market is, you're too late." \-- quote I saw
somewhere

Now, that's probably an exaggeration. You can probably have _some_ idea of the
size of the market before you get into it. Is it a small niche, a medium-sized
niche, or potentially huge? But I wonder if you can really be much more
precise than that.

~~~
endymi0n
Sounds like a lame-ass excuse for not even trying. Granted, if you're creating
a market like Google or Facebook, it's hard to impossible. If you're doing the
next AirBnB or Uber, it's pretty much on the table. If people can't come up
with a realistic Market size and their reasoning behind it, 90% of the time
they simply didn't do their basic homework (and usually the realistic market
size is minuscule).

~~~
ScottBurson
You really think the market size for AirBnB could have been reasonably
estimated when it was just getting started? Even if the founders had had some
clue -- and I doubt they foresaw it getting anywhere near as big as it has
gotten -- could they really have produced a convincing argument to support
their estimate? We know, in fact, that there were investors who passed on the
opportunity (I forget who, but I'm sure I've read this); so they, at least,
weren't convinced.

I do agree that the question is important to think about. And I think you
should at least be able to say broadly how big you think the market might be,
and explain your reasoning. And I also agree that it depends somewhat on the
situation. If you're trying to create a whole new market, as you say, it's
pretty much impossible; if you're trying to displace an existing player in a
mature market, you should be able to narrow it down pretty well.

~~~
pixelmonkey
Yes. Airbnb's original 2011 pitch deck is online. They literally have a market
size slide and supporting slides to back it up:

[https://www.slideshare.net/mobile/PitchDeckCoach/airbnb-
firs...](https://www.slideshare.net/mobile/PitchDeckCoach/airbnb-first-pitch-
deck-editable)

~~~
ScottBurson
They launched in mid-2008 [0]. By 2011 they had been running a growing
business for a couple of years; their Series A was in late 2010, apparently
preceding this pitch deck (!).

I was imagining the market size question being posed at the seed stage. (And I
suspect that whoever wrote the line I quoted above was thinking along the same
lines.) If we could read AirBnB's YC application, would it have a similar
estimate? I rather doubt it.

[0]
[https://en.wikipedia.org/wiki/Timeline_of_Airbnb](https://en.wikipedia.org/wiki/Timeline_of_Airbnb)

~~~
pixelmonkey
I mis-labeled the pitch deck as being from 2011. It's actually from 2008.
Described in this BI story as being a copy kept by an MBA student from that
period when investors were snubbing them.
[http://www.businessinsider.com/airbnbs-first-pitch-
deck-2015...](http://www.businessinsider.com/airbnbs-first-pitch-deck-2015-3)

~~~
ScottBurson
Oh, okay. Well, point taken, then.

------
scosman
The first one, "What do you do?", should potentially be renamed "What do you
do for your customers?". It took me a while to realize the importance of the
distinction when pitching.

Using the Google example from the article, the bad one answers "What does
Google do?" and the good one answers "What does Google do for its customers?".

~~~
danieltillett
I would even refine this down more to "What do you do for your profitable
customers?". Using google the answer would be "We bring targeted and motivated
leads to your website".

~~~
pedalpete
At Google's early stage, would that have brought investment? At the time they
would not have had distribution/market penetration, which is what the search
engine does for them.

~~~
danieltillett
When Google started they didn’t really have a plan for how they were going to
make money or get customers (as apposed to users)[1]. This is fine, but just
be aware of this when you pitch investors. If you don’t have a plan for how
you are going to make money be explicit about it.

1\. Personally I doubt that Google was that clueless early on as how to make
money. A better search engine is inherently valuable because of the ability to
direct traffic flow to favoured sites.

------
agentgt
Somewhat analogous I believe to previous post I have seen from a YCombinator
investor is basically: "Why You, Why This and Why Now?".

I'm paraphrasing. I can't find the original as there are lots of copy cats
(including Seth Godin [1]... intentional or not). Even ATDC [2] the very
startup booster organization that did not accept us (I laugh at this because
our startup is still around and successful unlike all the others they did
accept).

Which brings me to a great segue... you don't need a pitch if your company
makes money.

[1]: [http://sethgodin.typepad.com/seths_blog/2010/01/why-you-
why-...](http://sethgodin.typepad.com/seths_blog/2010/01/why-you-why-now.html)

[2]: [http://atdc.org/atdc-news/why-this-why-now-why-
you/](http://atdc.org/atdc-news/why-this-why-now-why-you/)

~~~
lpolovets
Any chance the original post you're talking about was
[http://codingvc.com/why-this-why-now-why-you/](http://codingvc.com/why-this-
why-now-why-you/) or [http://blog.asmartbear.com/five-
whys.html](http://blog.asmartbear.com/five-whys.html)?

~~~
agentgt
Aha I think I have found one of the originals: [http://altos.vc/2013/05/why-
big-why-now-why-you/](http://altos.vc/2013/05/why-big-why-now-why-you/)

IMO the above is very good.

~~~
lpolovets
Great article. Thanks for sharing it after you found it!

------
vyrotek
_" 4\. What’s your unique insight?"_

I particularly liked this section. It felt like a new way to ask "what is your
competitive advantage?" while generating a bit more insight into how the
founders perceive the problem their solving.

------
rl3
> _What is the ratio between what you’ve done and how long you’ve been working
> on it?

>I want to feel impressed with how much you’ve done in the period of time
you’ve had to do it. This can apply to a company that’s one week old or ten
years old._

You can't sustain the same ratio of work-to-time over the long-term. Barring
superhuman attributes, that ratio will decrease significantly.

~~~
brianwawok
I guess it helps weed the 6 year old product that is just a landing page?

~~~
rl3
Of course. I'm talking more about cases where exceptional products are born
out of early failure. There's usually a transition phase in between failure
and success that doesn't involve tangible work. Sometimes it takes months just
to figure out where to go next.

It's much easier to refine an idea when you've been immersed in a particular
problem space. Longer time frames also allow for taking a step back to think
and reflect—both of which are hard to do when your head is down and you're
constantly working.

------
skewart
This is good advice not just for how to pitch a startup but also for how to
pitch anything - say, a project within a company, or even yourself for a job.
Obviously the market size would be more about quantifying the potential return
on whatever it is you're pitching. And the one about the founding team might
be more about focusing on just the most relevant factors for why the people
involved are well-suited for the task. But overall these are great
recomendations for making compelling pitches for any business decision.

------
danieltillett
I am surprised that anyone would be against hearing genius ideas unless they
mean ideas that are not really genius ideas. True genius ideas are so rare
that they inherently interesting to hear about even if you don't want to
invest in the startup.

------
apathy
This advice applies to a lot more than just startups. Any time you're asking
someone for (real) money -- grants, etc -- the evaluation will be like this:

1) What are you proposing to do? (proposal)

2) Will it make any difference? (market/impact)

3) Can you get it done? (personnel/environment)

That's it. If you can't knock every one of these out of the park in a few
short sentences, you are unlikely to be funded by either the private or public
sector.

And before anyone remarks on how different the two are, note that the
SBIR/STTR program is mandated by Congress to pay out every penny of their
granting budget each year to try and turn publicly-funded research into
privately successful companies.

------
josh_carterPDX
Kind of piggy backing on the business model, you may not be thinking about how
to monetize your business today, but investors want to see you have a theory
around it. If not, you won't get their attention. We're in Techstars right now
and it's something we're hearing constantly. We know we don't want to worry
about monetizing the platform for the next 18-24 months, but we have to show a
path to get there. Whether it's for the individual developer or small dev
shops, we had to come up with some sort of answer that shows we're thinking
about it today. Super helpful and it should be included in this blog post.
Otherwise, spot on post!

------
wfoweoi
> I want to feel impressed with how much you’ve done in the period of time
> you’ve had to do it.

If your startup doesn't pass this test, is there any good advice on how to fix
it (either for this startup or future startups)?

~~~
balls187
What is causing your productivity to be so low?

Fix whatever that is, get productivity back up.

------
jonwachob91
>I also tend to value product development and customers first and other things
such as fundraising or biz dev deals a distant second.

Can you walk me through the difference between customers first and biz dev
deals?

~~~
andyjsong
Generally, customers are a direct source of revenue.

BD deals is creating channels that might result in customers/revenue. Both are
important, but revenue is more important than the potential to get revenue.

------
dyarosla
Very similar to the general pitch process we emphasize for startups coming out
of UWaterloo, just this article was a little too vague on the details. I
summarized our pitch formula (with some overlap but more concrete tips) here:
[https://medium.com/@dannyyaroslavski/perfecting-
the-3-minute...](https://medium.com/@dannyyaroslavski/perfecting-the-3-minute-
pitch-410285d971ce)

------
hoodoof
All you need to do is bring us a guaranteed globally successful viral mega
product that no one has ever thought of before, be perfect is all ways with no
risk to us and we will graciously back you with terms that are crushing and
ensure you as the entrepreneur get next to nothing in the event of a liquidity
event.

~~~
cmbailey
What I found most valuable: what he tells entrepreneurs they _don 't_ need to
spend a lot of time on, in building the company and in presenting it. I've
seen so many decks and pitches devoted to the team's credentials and past work
experience, and about deals they've done or are doing.

So Michael is saying something useful: we're willing to invest in a team with
no credentials, no deals, no business development. Other things are more
important. Things that are democratically available to us: building product,
iterating with small customers, clarity of communication.

------
j45
What I like about the list is how it forces focus on how value is being
created and added. Often when you have selected an idea you start looking for
reasons why it will work, rather than looking for reasons to shut it down by
testing that it doesn't work and instead it just keeps growing.

------
snissn
It seems like this article is written for a small group of people that
recently pitched him!

------
outdooricon
Anyone else have trouble figuring out how to determine market size? Do I have
to spend thousands of dollars for independent research online or is there
another way that I'm just too naive as a developer to be aware of?

------
namanyayg
> "7\. What do you want?"

What would be a good way to ask something specific, without coming off as too
arrogant or needy?

~~~
erichocean
General outline: To achieve _X_ , we are looking for _Y_ and thought you might
be in a position to help us out with that.

 _X_ = A goal you are working on achieving. It should follow naturally from
the description of your business.

Example: We are looking to demo our product to attendees at SXSW next year,
like Twitter did originally.

 _Y_ = What you are asking for (investment, introduction, etc.). Should be
obviously beneficial towards achieving _X_.

Example: Who should we be talking to at SXSW to make that happen? We've
already spoken to…

------
bettyx1138
i like how the article is simple and to the point. thanks.

