This is What I do – But This is What I believe In
To be investable, start-ups need a significant amount of ‘virtues’ that are largely encapsulated in an Executive Summary of their decks. They attract investment to produce wealth and generate a profit. Whether they bleed, hurt or despair in the process of creating that wealth is irrelevant; the Term Sheet they receive is essentially about key performance indicators, road map milestones and investment conditions.
Start-up founders spend a long, long time on their pitch decks: while raising finance in pre-seed depends massively on the strength of the team, and on its members’ ability to deliver on the loan conditions agreed on in the Term Sheet, the team structure and its expertise matters less in seed and series A.
What start-up founders seldom do – as it is still wrongly perceived as a sign of weakness by many – is seek to make a human connection with their investors, and with those who help them get through a MVP or a POC. After all, the paradox of the business world – let alone that of VC investment – is that unless one really ‘clicks’ with the investor or major client, nothing will happen: irrespective of how strong or experienced the founding team is. We have seen it repeatedly.
There is an extremely powerful book by Rabbi Joseph Soloveitchik called ‘The Lonely Man of Faith’. In it, the clash between our inner and outer personas is beautifully rendered, with takeaways that are particularly significant for today’s start-up founders: our outer persona wants to conquer the world, to become famous and rich, while our inner persona wants to obey a calling and serve the world.
Can a start-up founder do both? Can s/he clearly demonstrate that in his/her pitch? How? Perhaps the most illustrative example of the incredible power of a speech meant to sway audiences and make them reflect on what they know and hold dear is this TEDx Talk by Chimamanda Ngozi Adichie, the multi award wining Nigerian writer and humanitarian. Watch it, reflect on its underlying themes, and then see how much your perception on what to say and when to say it has changed.
For a pre-seed start-up to get a conversation with a VC or angel investor, its pitch deck needs to stand up a first pass, and to be robust enough for them to want to talk to you. Then, it is all up to the founder to ensure a positive outcome, noting that a large part of that outcome hangs on the founder’s ability to tell a story, his/her story, and let their personality shine through.
To get seed financing, the start-up founders need to be able to show, in details, how that capital will be used to develop their business idea to the point that it can be presented effectively to venture capital firms that have capital available to invest. Many seed stage start-ups have staff and advisors although they may not have an actual product.
For a series A start-up fundraise – which is typically in the range of tens of millions of dollars – what matters is to be able to demonstrate to any potential investor that you have a viable business model with a strong growth potential.
That journey is heavily reliant upon the start-up founders’ ability to draw their inner persona into their outer one; pitching is storytelling as much as it is science and research. Recently, one of our start-up founders did that and, in a room filled with dozens of start-ups pitching to a panel of investors, her pitch – and the way she told her story – stood out by a mile (and for all the right reasons).
In the world of start-up accelerators, incubators and other support mechanisms, there is an almost set structure of what a pitch deck should contain, and what a founder should be saying during his/her pitch: facts, data, and performance metrics.
We, at Circklo, consider the facts, data, and performance metrics of a start-up business just the baseline. What we show our founders is how to make the very best of what they already have: a story; a lived experience which comes to life in their own words.