Until recently, I’ve done a fairly poor job of selling my company. Yes, I was good at exciting people. No, I was not translating excitement into investment. I’ve improved through optimism, tenacity, and advice.
Two years ago, I thought I was great at presenting. I even wrote a post about how to pitch for investment. However, the more meetings I took, the more I suspected that my content and style were off, but since my presentations received such positive responses, it was hard to pinpoint what was wrong.
This last fortnight I had been out on the fundraising trail, for we’d just opened our third and biggest round yet. I had met with a new class of investors and could not afford the same level of knockbacks. I had to improve my strike rate.
So I visited a consultancy group. They forced me to re-write my deck from scratch and re-think my style. At first, I felt offended that they didn’t like my presentation. Yet, as I made their suggested changes, I discovered that I still had much to learn. If I hoped to raise that capital, I had to improve.
Here are a few of my changes:
Put all the facts upfront
I used to open my presentation with an engaging story to captivate my listener. Then I’d take the investor on a journey through our product, aided by a stack of pretty screen shots, and then hit them at the end with our impressive growth statistics and team, aiming to finish on a high. Everyone left with a smile, almost everyone wanted to introduce me to their friends but few invested significant sums on the spot.
This had to change. Now, I open with the hard-hitting stuff. Key investors, team members and growth statistics are on the first slide, for my task is to establish our credibility in the first 60 seconds. I spend less time telling my audience about the product and how it works, more time showing it working by demonstrating actual applications.
Cover everything in the presentation
Two years ago, I focused on entertaining stuff like how I bought the domain name or came up with the idea. They elicited a positive reaction and helped me build rapport, but reduced my chances of raising investment. Investors did not perceive Posse as serious business. I seldom addressed tough issues in my presentation, but received them later in questions such as: ‘How much have you spent so far?’ ‘What have you spent that on?’ ‘Who owns what shares in the company?’ and ‘When will you break even?’
I do now. My pitch deck features slides that address every tricky question, and I go through each one in detail. I’ve worked at making the presentation more serious, transparent and, I think, effective.
Momentum, momentum, momentum
The only way to close an investment round is with momentum. In my early pitches, I’d slightly inflate our numbers and talk about deals that were incomplete in order to sound more impressive. I knew that by the time due diligence started, we would have those numbers.
This approach has a damaging effect. Once a deal starts rolling, investors want to know how many users we have this week, and the next, and the next. They don’t care how many we started with – what matters is momentum.
Now, I avoid any overstatement of progress in this first meeting and issue regular updates showing that we have gained this many additional users, signed that major deal, and so on. This generates a sense of momentum more powerful than a slightly more impressive first meeting. It’s also honest.
I have always been comfortable with my natural style. I know how to charm a meeting, and have been reluctant to change my approach. Recently, however, I have made some slight adjustments in order to come across as more serious. This was very much a personal decision.
I have made slight changes to what I wear, my vocal tone, the amount of eye contact I make, and my body language. At first I felt uncomfortable, but I’m easing into it. I’ve noticed that subtle body language adjustments can greatly change my level of confidence and change the way I interact with listeners through my delivery. I read a recent study by MIT Labs that analysed the body language used by presenters during a large number of sales presentations. By the end of the study, they could identify whether the presenter would make a successful sale without listening to the dialogue at all. The predictions, made by watching the presenter’s body language, were 85% accurate.
I’ve met with more than 20 potential investors this past fortnight. We are experiencing a higher level of interest than ever before, partially due to our business’s momentum, and partly due to our having a clear path to scale. I’m sure my pitch and delivery is stronger than it has ever been, and I’m sure that in two years’ time I’ll have the material for another post describing all the secrets I have yet to learn. I know there’s so much I don’t know.
I sense that we will close this round quickly. As always, I’ll tell you everything here.