The secrets to a foolproof funding pitch
Throughout this season of Platform Diaries, my guests and I have delved into many of the factors that contribute to the success of start-ups. However, in today’s episode I explore the obstacle that remains at the forefront of founders' minds: money.
A bitter reality about start-up success is that for the most part, no perfect product or tenacious team can succeed without acquiring sufficient funding. To quote Cyndi Lauper’s 1983 pop hit… “money changes everything”. One of the first steps in acquiring the monetary support to get your product to market is through pitching your idea to potential investors. In order to crack the code to the perfect pitch, I have enlisted the help of Ferdi Reynolds, a Venture Capital (VC) Investor at SuperSeed - a venture capital fund that invests in seed stage B2B SaaS/AI companies.
Unfortunately, Ferdi starts with a bit of bad news.
“A lot of people are still overlooking the fact that when applying for institutional funding, the level of competition, the level of saturation, and the number of people applying for the same ticket is at an all-time high.”
A VC may review at least 10 pitch decks per day. The consequence of this is that people must find a way to break through the noise and stand out from the pack. So how can you do this?
“Excellent businesses are able to express the very beginnings of a company culture before one is even really formed, and in some cases, before a company is even really formed.”
Allowing your personality to shine through during your pitch deck is a key method of standing out from the pack.
“It’s about bringing your sensible idea to life in a way that gets investors excited,” he shares.
Ferdi reflects that a winning pitch leads to smiles and knowing looks between his colleagues in the boardroom. On the flip side, a long, slide heavy presentation can lead to yawns and heavy eyelids.
“The number one reason that we reject businesses is because they're not on our model… know which fund you're applying to and make sure that it's a good match.”
Besides ensuring that you are applying to a fund that will work logistically, Ferdi shares that a classic mistake is making assumptions about what the investor is interested in and that they understand what you are talking about.
“These experts and technical founders have discovered something pretty new, so there's no chance that I'm going to fully understand the meat of the conversation unless they really help me unpack it for me… it's always better to check in and just make sure that everybody is up to speed.”
He shares that one of his key pieces of advice is ‘keep it simple’. The key things that the VC should know is what is your business like, what do you do, who are you trying to serve and why are you trying to serve them. He is less interested in knowing about the backend of a product.
At the crux of it all, Ferdi suggests approaching it like a conversation. He warns of the risk of “death by slides”, where the founder is pitching at the investor, rather than talking to them.
“I think really successful investments are partnerships, rather than just an exchange of capital. In order for that partnership to work you have to really understand the energy in the room, who's who, and what's going on… and that takes time.”
Slowing your pitch, allowing time to be personable and approachable with the VC, demonstrating your personality and ensuring there is dialogue in the meeting are sure fire ways to stand out from other pitches.
“It is very sort of Pythian and very millennial, but it really does matter how quickly you are able to form a bond and some sort of relationship, even if it's quite superficial at first," Ferdi shares. "For us, a hugely important part of our diligence process and probably the most important part at the beginning is answering 'how do we feel about funding this team?'”.
Ferdi explains that as a VC, the very first pitch deck does not normally result in a decision. It is best to use this as an opportunity to meet each other, as the relationship will become very important down the line.
“The final mistake that I can identify, and something that we find a little uncomfortable is bringing on a cast of thousands of people onto the call.”
This causes confusion and can change the energy from a casual conversation to a formal style presentation, which leaves minimal room for fluid discussion.
Although each fund will differ, Ferdi reveals that one of the first questions that they ask is what your origin story is. He wants to know what made you leave your cushy job to begin your start-up.
“That's when you really start seeing the personality, 'cause it's rare that founders are given that opportunity to talk about their personal journey.”
Achieving funding for your start-up could be that ‘make or break’ moment that propels you forward. Taking onboard some of the advice that Ferdi shares may be your secret to the perfect pitch. Throughout this season of Platform Diaries, my guests and I have delved into many of the factors that contribute to the success of start-ups. However, in today’s episode, I explore the obstacle that remains at the forefront of founders' minds: money.
A bitter reality about start-up success is that for the most part, no perfect product or tenacious team can succeed without acquiring sufficient funding. To quote Cyndi Lauper’s 1983 pop hit… “money changes everything”. One of the first steps in acquiring the monetary support to get your product to market is through pitching your idea to potential investors. In order to crack the code to the perfect pitch, I have enlisted the help of Ferdi Reynolds, a Venture Capital (VC) Investor at SuperSeed - a venture capital fund that invests in seed stage B2B SaaS/AI companies.
Unfortunately, Ferdi starts with a bit of bad news.
“A lot of people are still overlooking the fact that when applying for institutional funding, the level of competition, the level of saturation, and the number of people applying for the same ticket is at an all-time high.”
A VC may review at least 10 pitch decks per day. The consequence of this is that people must find a way to break through the noise and stand out from the pack. So how can you do this?
“Excellent businesses are able to express the very beginnings of a company culture before one is even really formed, and in some cases before a company is even really formed.”
Allowing your personality to shine through during your pitch deck is a key method of standing out from the pack.
“It’s about bringing your sensible idea to life in a way that gets investors excited,” he shares.
Ferdi reflects that a winning pitch leads to smiles and knowing looks between his colleagues in the boardroom. On the flip side, a long, slide heavy presentation can lead to yawns and heavy eyelids.
“The number one reason that we reject businesses is because they're not on our model… know which fund you're applying to and make sure that it's a good match.”
Besides ensuring that you are applying to a fund that will work logistically, Ferdi shares that a classic mistake is making assumptions about what the investor is interested in and that they understand what you are talking about.
“These experts and technical founders have discovered something pretty new, so there's no chance that I'm going to fully understand the meat of the conversation unless they really help me unpack it for me… it's always better to check in and just make sure that everybody is up to speed.”
He shares that one of his key pieces of advice is ‘keep it simple’. The key things that the VC should know is what is your business like, what do you do, who are you trying to serve and why are you trying to serve them. He is less interested in knowing about the backend of a product.
At the crux of it all, Ferdi suggests approaching it like a conversation. He warns of the risk of “death by slides”, where the founder is pitching at the investor, rather than talking to them.
“I think really successful investments are partnerships, rather than just an exchange of capital. In order for that partnership to work you have to really understand the energy in the room, who's who, and what's going on… and that takes time.”
Slowing your pitch, allowing time to be personable and approachable with the VC, demonstrating your personality and ensuring there is a dialogue in the meeting are sure-fire ways to stand out from other pitches.
“It is very sort of Pythian and very millennial, but it really does matter how quickly you are able to form a bond and some sort of relationship, even if it's quite superficial at first," Ferdi shares. "For us, a hugely important part of our diligence process and probably the most important part at the beginning is answering 'how do we feel about funding this team?'”.
Ferdi explains that as a VC, the very first pitch deck does not normally result in a decision. It is best to use this as an opportunity to meet each other, as the relationship will become very important down the line.
“The final mistake that I can identify, and something that we find a little uncomfortable is bringing on a cast of thousands of people onto the call.”
This causes confusion and can change the energy from a casual conversation to a formal style presentation, that leaves minimal room for fluid discussion.
Although each fund will differ, Ferdi reveals that one of the first questions that they ask is what your origin story is. He wants to know what made you leave your cushy job to begin your start-up.
“That's when you really start seeing the personality, 'cause it's rare that founders are given that opportunity to talk about their personal journey.”
Achieving funding for your start-up could be that ‘make or break’ moment that propels you forward. Taking onboard some of the advice that Ferdi shares may be your secret to the perfect pitch.