Week 9 Recap: Fundraising and Team
In Week 9, we talked about two big topics that will help you build your venture as a standalone business: Fundraising and team.
We explored funding sources that are relevant for different types of ventures:
- For every entrepreneur: Explore equity-free funding from competitions, prizes and grants. Look at what the alma mater of each cofounders have to offer, as well as other universities that may offer competitions and grants that are open to all. Government grants are another possible source. A third source are companies and organizations that offer funding to founders and companies like you and your venture.
- For growth-style startup founders: Familiarize yourselves with the in’s and out’s of startup fundraising . Stay abreast of market, technology and funding trends by following tech media such as Techcrunch, as well as regional tech coverage such as BostInno and Xconomy. Analysts like CB Insights and Pitchbook often provide great industry overviews in free articles. Also follow content created by relevant accelerators and VCs such as YCombinator, Nextview Ventures, Founder Collective, Underscore VC and the like.
- For small business enterprise (SME) founders: Newly created small businesses that do not fit the high-growth model do not fit the model of VC investments. SME founders need to consider different types of capital. The best source of capital is earned revenue. This requires a deep knowledge of your market and customer, a solid go-to-market strategy, and a revenue model and operational strategy to get you to cash-flow-even in the least elapsed time possible.
- For non-profit founders: Apart from the grants mentioned above, non-profit founders might explore philanthropy as a source of cash injection. This includes raising large checks from individuals and foundations and small checks through crowdfunding campaigns. This is not easy – and so, earned revenue remains an excellent source of cash.
We explored two aspects of building your team: The founding team, and your early employees.
- To build a winning cofounding team: First, assess whether your team is balanced in the hacker / hipster / hustler distribution. Then, make sure you have the major skillsets and experience bases covered. Last but not least, read Gloria Lin’s 50 questions to ask your cofounder checklist again to make sure your cofounding team is aligned.
- To hire and nurture your first employees: Learn how to write a good job description while being flexible about job requirements and hire for talent, not a checklist of skills. Actively define and cultivate a culture that is unique to your venture.
Week 10 Focus: Pulling It All Together
This is a great time to review your business fundamentals, and revisit various documents you have created along the way to cross-check your business, and communicate your venture to your advisors, peers and potential funders.
Revise your venture canvas
Whether you chose to develop a business Model Canvas, Lean Canvas, Disciplined Entrepreneurship canvas, Mission Model Canvas or other variants, take a few moments to revise it. You will be amazed at how much more you know about your business now versus when you first created your canvas.
Revise your executive summary
The same goes for your one-page Executive Summary which you have created in Week 5. The progress you have made should help you iterate and uplevel this document.
Make sure you understand your unit and overall economics
While detailed financials are never appropriate to present in the main pitch, it is absolutely paramount that you have solid understanding of your unit and overall economics, so that you can paint a picture of what your venture can become and show your audience a “path to greatness” in terms of impact.
Be sure to revise your revenue models and your 5-year pro-forma income statement. Have that handy as an appendix in case questions come up about your business model, and your plans to arrive at financial sustainability.
Fine tune your venture pitch
You will already have delivered your Demo-Day style venture pitch multiple times. But is your pitch current in terms of what you have learned? Does it incorporate all the feedback you have received along the way?
The process of creating and updating your venture pitch serves the same purpose of the old-style written business plan – only faster and with more reuse opportunities. Be sure to claim credit for all the track record you have developed over the summer.
Check your marketing presence
How are you doing with regards to your basic marketing presence? If someone who does not know you or your venture happens upon any of your digital presence (website, social media and the like), will they form the right impression of you and will they understand what you do and why they should care? Don’t overthink it – just get a basic level of professional presence out in the digital world and build on it over time.
Pro-tips on Pitching Your Venture
Following are some pro-tips to help you develop and deliver the best venture pitch possible.
Get to know the audience
When you are delivering the pitch, your goal is to communicate your passion and vision to the audience in the room (whether in-person or virtual). It is important for you to understand who is in your room.
For most private meetings you will know who you are talking to. You can do research on Google to understand who they are, what they know and what they care about, so you can tailor your pitch to speak to their interests.
For networking and Demo Day events, you usually won’t know who is coming ahead of time. You will need to make some educated guesses about the types of personas in the audience and what they are looking for when they come to see you pitch.
For example, for a university accelerator Demo Day, we typically see other student and alumni entrepreneurs, advisors and mentors, potential funders, and the general public in our ecosystem who are interested in what Tufts entrepreneurs are creating. They will come from all sorts of backgrounds. Most of them will not know you and many will not know your industry domain. You will need to make your pitch emotionally interesting so you make a connection, and build up each idea you present based on something else you presented early on so even complete strangers can follow your pitch and be inspired by you.
As a rule of thumb, your audience for short venture pitches do not need technical details on how you implement things. What they need to know is why you are in business, what the problem is, how you solve it, what is special about your solution, you and your team and therefore, why you are the team to solve this problem.
“Think, Feel, Act”
What do you want the audience to think, feel, act? Write this out first and it saves you a lot of time.
You want to open with something that really captures the imagination of the audience. 2 pro tips from Professor Beth McCarthy, Lecturer for Derby Entrepreneurship Center:
- Always remember your why – your underlying passion for the problem you are solving
- Start with the user / customer and go light on statistics. Make it relatable.
Develop a narrative structure
For 60 second pitches we like:
For a 5 minute pitch you can do
- Who is the customer / what are their pain points
- Solution / how it’s better
- How big can your impact be / what is your path to a much bigger market
- How it can be financially sustainable
- How is the world a better place / how are your customers in a better state once your solution exists?
However, please use this as inspiration only. Make sure the requisite information is covered – but in a flow that is authentic for you. It is your story – tell it your way!
End with an ask or call to action, or a “mic-drop moment”
People will remember how you start and how you end more than the details in your pitch. One way is to end with a call to action so people have something to do / think about. E.g. “If you also care about X, come talk to us afterwards and together we can <do wonderful thing together>” or “We are looking for advisors in area X – help us do <ABC>”
Another way to end the pitch is to end with an aspirational vision that lifts everyone and inspires them to think of a better future.
Either way, make sure you “stick the landing”. Some teams are so pleased to arrive at the end of their pitch that they rush the ending – don’t do that! People remember how you enter and how you exit and it is very important to take the time to reiterate your call to action and/or restate your tag line, and end strong.
Start strong, finish stronger
People remember how you start, how you finish and how you make them feel in the middle.
Make sure you start strong, make an emotional connection with a “hook”, tell a compelling story then end stronger. Especially the ending – make it intentional and memorable – a lot of people sound like they are relieved to get to the end. That detracts from your ability to make an impression. Instead: End the pitch on a high note then go into the Q&A.
A lot of teams end with a call to action: “I ask you to get out your phone right now, go to the App Store or Google Store and download X. It only takes a moment! Thank you!” or a repeat of their tag line: “We are Company A. We <insert amazing thing you do that makes the world better>. Thank you”. Then, they pause. Then, mic drop.
Create beautiful slides
The current look for pitch deck is a highly visual, simple, clean look with very few words on them. Consult Hubspot’s “How to design a slide deck that doesn’t suck” for pro-tips.
Have a look at the 2022 TechStars Boston Demo Day and watch a few videos to see how the professionals do it. We do not expect you to be at the level of maturity as these startups – but you CAN have the same stage presence – use this as a style guide and source of inspiration for your own pitch.
Not a designer? Canva.com is a free graphic design service that offers a lot of slide templates to make it easy for you to achieve that clean look. Just know that a lot of people use Canva so if you don’t customize your template, you may end up with the same exact colors as someone else’s deck.
Slow down when delivering your pitch
Most presenters rush. Don’t. You want to be talking at a rate that is slow enough for good verbal comprehension for the audience. We find that pitches that go faster than about 100 words a minute are hard to understand.
Also, research shows it takes 7 seconds for people to get used to a new person’s style and accent. Make sure you don’t overload the first 7 seconds with a lot of super important details – this is especially true for people who speak English as a second language.
Pause before and after your pitch
Most of these events are recorded and we typically trim the videos so each team can have their own video clip of their main pitch.
For this to work successfully, please show your first slide, get ready, then pause for a moment, smile, then start. Complete your pitch up until the mic drop moment, stop strong, pause for a moment, then invite questions. This simple pro-tip will also give you a much stronger start and end to your pitch.
Hands and body
Some presenters touch their face or hair while presenting without realizing it. This is distracting and takes away from your gravitas. Try keeping your hands at waist level and gesture with the whole palm open, from the midline of your body outward.
Some presenters move around a lot – they may alternate their weight from one leg to the other constantly, or they may walk continuously. This is also distracting. Plant yourself, make eye contact with at one person (anyone will do), deliver a thought, then walk purposefully (if you choose to walk). Stop, make eye contact with a new person, and deliver another thought. Don’t keep moving – that detracts from your pitch.
Do not wring your hands – gesturing with your hands to help make your point is good, but do it a little more slowly than you would do in normal speech.
Make sure your body language is open and relaxed and your shoulders are down. Practice some power posing for 2 minutes before going on stage – it really helps.
Be intentional about how you practice
You don’t need to go top to bottom every time, in fact that’s not effective. Intentional practice with trouble spots is much more time efficient. How we do it:
- Go top to bottom a couple of times.
- Practice the beginning and the ending. Once more, with feeling: People remember how you start and how you finish, then they remember how you made them feel. The middle, not so much. So: Practice the first 15 seconds until you are comfortable. Once you are in the pitch your momentum will take over and you’ll be fine. Then repeat with the end.
- Go top to bottom again and find all the places you are getting stuck.
- Back up 1 sentence and practice that transition until you get it down – sometimes that means you need to change how you deliver that talking point, other times it’s just getting comfortable.
Be careful with scripts
Scripts are good, and scripts are dangerous. TED speakers work from a script – but they spend 6 weeks iterating it, writing and rewriting it, practicing until they are over practiced (the “uncanny valley” when you sound flat, like a robot), then they keep pushing past that point until they can emote at will over the script which has become part of them.
$100k teams do not have this much time. A much easier thing to do is to write down a few talking points and then just give yourself the talk top to bottom a few times to get a hang of it, then just talk to the talking points. You will sound like your conversational self and you will not sound like you are reading from a literary classic.
Don’t worry if you skipped some points during the delivery
No one knows what you meant to say in the beginning – if you forgot a whole paragraph, that’s totally fine! Just keep swimming.
For more information, consult the pitching page of the Resources section in the DEC Student portal.