Pitching to the VC is like sharing your background in a job interview. Reid Hoffman, founder of LinkedIn, in his recent article titled What I Wish I Knew Before Pitching LinkedIn to VCs, provides insight into wrenching money out of the Venture Capital investors. You need to think about some of the myths he mentions when you are preparing for that all-important job interview.
My comments for you follow his myths and realities.
Money
MYTH: The start-up financing process is about one thing — money.
TRUTH: A successful financing process results in a partnership that delivers benefits beyond just money.
Your interview should not be all about money. You need to prove your value for the position. Show energy and explain why you are uniquely qualified. Wait until they understand how cool you are. Prove they won’t want you working for their competition! The money comes later.
Analysis
MYTH: All investment pitches have the same structure.
TRUTH: Decide whether your pitch is a data pitch or a concept pitch.
What are you selling? Why should the company hire you? Is it because of your technical expertise or your sales ability? Are you selling your analytic ability, your judge of character or strategic agility? You need to determine your features and the benefits to the company. Write them down. Be able to tell a story about each. You may not use all of them in an interview, but just knowing them will give you confidence.
Future Value
MYTH: Focus on today’s pitch. The future will take care of itself.
TRUTH: Think also about the round after the one you’re currently raising.
You want to demonstrate your immediate and long-term value for the company. If you are interviewing for an entry level job, what talent do you bring that others can’t? If you are a 20-30 year individual contributor, what makes that an advantage to the company? Don’t mention age, but share a story of success in working with all age groups.
Objections
MYTH: Avoid bringing up anything that might paint your business as risky and decrease investors’ confidence.
TRUTH: Identify and steer into your risk factors.
When you sense an objection, such as lack of a particular skill, don’t pretend it’s not a factor. Face it and say how you overcame a similar liability in another job. You need to assure them you can do the job, despite a missing piece of their puzzle to fill the opening. Be brief and move back to your best attributes. Time is limited that you must use wisely.
Read Hoffman’s entire article and think about how it relates to your transition. You are pitching your product or service, since you are the product. You need to plan and prepare, using the realities entrepreneurs demonstrate to gain traction.
Prepare your pitch by focusing your skills and experience to advantage. You’ll be far more prepared than most!