To paraphrase General Helmuth von Moltke – famed for his thesis that ‘no plan survives contact with the enemy’ – it’s obvious to all business founders that no plan survives contact with the market! Especially anything to do with timing, a point well made in Margaret Heffernan’s latest Inc post:
So you’ve got a great team, and a fantastic idea that fits like a dream into a gap in the market. Not only that, a financial wizard has produced a set of figures that suggest you can all retire in three to five years time. All you need now is some money. No problem. This is the most investable idea there’s ever been. Anyone could see that. You’re ready to talk to the angels. Stop!
Time for some homework
Do you know anything about the investors? And what do you know about pitching to entrepreneurs? The first bit is quite easy. Ask about the panel, and do some research on how they made their money. What makes them tick, and where do their interests and values lie? Also, do they have any specialist knowledge? Critically: Are you sure you know more than they do about your proposition? You certainly should do! Don’t imagine that you’re going to be able to wing it.
Look, this is a selling job, and the first thing to know about selling is you must know what you’re selling, and who you’re selling it to. Which brings me onto the second big question, if you’re going to be dealing with a panel of successful entrepreneurs, you need to know what entrepreneurs are like. Do you? Here’s a quick crash course.
Try: heart first, head second
First, entrepreneurs are usually energetic, passionate folk. Give a pitch that suggests you’re really really interested in your business idea, and you have the drive and zap to see it through. Better still, tell them what your drive is. What gets your motor running? Remember: all that emotional stuff is processed by the brain before the dry logic of your market research, or the endless figures supporting your financial projections… You need to appeal to the heart first, the head second. This allows you to capitalise on the fact that entrepreneurs are intuitive thinkers, and that they genuinely trust their initial (emotional) reactions.
Get to the (jargon free) point
Next, most entrepreneurs are ‘do it now’ people. They have a need for immediacy and get bored with too much detail. What this means is that whilst you do have to have the facts and figures at your finger tips, your pitch must be quick and clear. Frankly if you can’t explain the basics of what you want to do, and what you want from them in 60 seconds, all the time in the world isn’t going to help. Get your message sorted out. You must make an immediate impact before you paint the rest of the picture.
Go for the vision thing
Entrepreneurs are interested in ‘difference’. They are comfortable with change and new ideas. Sell the difference – your USP – and explain how it fits into a bigger picture. Why? Well, isn’t this what it’s all about? If you don’t have a vision of how you can make things change, and can’t explain how to scale up your proposition, it’s not going to be investable.
Create a potent message
Okay, where’s all this going? Simple. Likely as not you will be talking to some pretty savvy investors. They know what it’s like to have big dreams and even more ambitious goals. To want to make a difference. To be so fired up that little else seems to matter. So do it right:
- Idea. What’s the (big) idea and what’s the claim, i.e. what’s the business proposition and why is it different and better to what ever else is out there.
- Benefits. What are the three most compelling reasons that support your claim? This means what are the key benefits of your proposition. For example, what ‘problem’ is it actually solving? How will it change things for the customer?
- Validity. What evidence supports your claim? This can be in the form of (simple) stats, quotes from experts or customers, perhaps even a story. But give the listener a reason for wanting to hear more.
If you can do this and load your pitch with passion and sincerity, you might stand a chance. Oh, and by the way, what’s so special about you or your team, and why are you the only people who can make this thing fly? Precisely what is everyone putting in, and more to the point, what are you putting on the line? Commitment, commitment, commitment…
If you’re interested in the (growing) link between personality research and neuroscience – that’s the way in which we are able to map specific areas of the brain in terms of personality traits – the link below is a good place to start. And if you’re reading this and thinking, you know, that sounds sort of interesting, you probably have your Amygdala to thank… Why? Click and find out.
There’s a good article on the HBR blog about entrepreneurial skills. Amongst other things it confirms that serial entrepreneurs are persuasive, goal orientated leaders; however it also covers the skills they tend to ‘lack’. These include analytical problem solving (as opposed to the strategic ‘visioning’ stuff), planning & organising, self-management and the like.
What’s interesting about the list, apart from the fact that it confirms some of the things I recognise in successful entrepreneurs, such as being far too busy to check the details (the analytical stuff), is that it mirrors research on dyslexic entrepreneurs. Research by Professor Julie Logan at Cass Business School, for example, suggesting that 20% of UK entrepreneurs are dyslexic, compared to a rate of 10% in the general population.
Strange coincidence, or perhaps a clue as to why there are so many dyslexic entrepreneurs? It might be that linear thinking, planning and self-organisation are not important to business creation. It would be fascinating to know.
Julie Logan: http://www.youtube.com/watch?v=i0NQcljwdKI
Have you ever wondered what it means to receive one of those ‘out of office’ emails? Well, here’s the truth (!):
One of the critical things about making a decision is to have enough information to make a proper judgement. To do this a person needs to be able to identify the gaps in their knowledge, to fill them, and then to come to a sensible conclusion.
Someone who does not see that there are gaps, or who jumps to a conclusion with too little (or inaccurate) information can blindly make decisions without realising what is missing or unclear. What this amounts to is that for judgement and decision making there are four basic types of people:
Over-confident: This is someone who has high confidence in their judgements even when their thinking is faulty. They believe that it’s better to make a decision, even if it’s the wrong one!
Development point: The positive side is that over-confident people take the initiative and get on with life. However they do need to ‘take five’ and learn to recognise when more information is needed. It’s all about thinking before acting!
Animal: The over-confident person is like a Cobra – quick and decisive, but not always hitting the right target.
Under-confident: This is the sort of person who generally has no confidence in their judgement and decision making, even when they’re right. They often find it difficult to get ‘off-the-fence’ because they believe they’re going to jump the wrong way.
Development point: The positive side is not ending up in tricky situations just because they haven’t thought things through properly. However this may end up in no action at all; so to move on someone needs to force themselves to make decisions in low-risk situations, just to recognise that the sky doesn’t necessarily always fall in!
Animal: The under-confident person is like a Gazelle – bouncing around trying to decide what to do, and never quite making their mind up.
Accurate: This is the sort of character who reads situations with confidence, and knows when they’re getting things right or wrong. They have the savvy to check the signs and know if they are taking a risk.
Development point: This person is on the button and has got decision making pretty well organised.
Animal: The accurate person is like a Fox – weighing up the situation, balancing the risks, and picking their battles.
Inaccurate: This is someone who charges at things and gets most decisions the wrong way round. They are not confident when they’re getting things right, and over-confident when they’re getting stuff wrong.
Development point: The good news is that this person wants to do things, it’s just that they have a habit of getting everything upside down. A bit like the Cobra this person really needs to think before acting, in fact they need to think, and think again before acting!
Animal: The inaccurate person is like a Bull – enthusiastically charging backwards and forwards, but tending to put their foot in it.
What sort of an animal are you?
1. How do you feel when you have to make a snap decision?
A Energised – It’s better to make a decision than no decision at all
B Decidedly queasy – I don’t like having to make a decision
C Confident – I’m pretty good at weighing things up quickly
D Resigned – I’m famous for making the wrong decision.
2. When deciding between a number of options, do you…
A Pick one and stick with it, even if it turns out not to be the best
B Want more and more information (you can never have too much)
C Dispassionately check out the options and move on
D Home in on the wrong one like a guided missile?
3. If you haven’t got enough information, how do you decide what to do?
A Gut instinct
B I can’t decide (you just said there isn’t enough information!)
C Go with what I calculate is the best bet
D Pick anything – it’ll all go pear shaped anyway.
4. You’re going to make an expensive purchase in a shop, do you…
A Just go in and buy it
B Come over all uncertain
C Check that it’s what you want, and then buy it
D Feel like you’re about to make another costly mistake?
5. It all goes horribly wrong, what do you do next time?
A Exactly the same!
B Nothing (there isn’t going to be a next time)
C Better research
D Take a lucky rabbit’s foot.
6. What’s happening in your head when making a really BIG decision?
A Surprisingly little
B A Headache
C A meticulous balancing of the pros and cons
D A feeling of déjà vu (and not a pleasant one!)
7. You have a number of things to do, how do you decide where to begin?
A First on the list
B Definitely look at the list, but it won’t be nearly long enough
C The most important thing on the list
D Gave up using lists years ago.
8. How would your best friend describe your judgement?
A Shoots wildly from the hip
B Never gets his gun out
C Hits the target, every time
D Judgement, what judgement?
Mostly A = Over-confident (Cobra)
Mostly B = Under-confident (Gazelle)
Mostly C = Accurate (Fox)
Mostly D = Inaccurate (Bull)
Note: This is a fun questionnaire! However it is based on sound research and I wrote it for a magazine a couple of years ago.
Perhaps the secret of successful coaching is helping people to look at life in a different way… Try this thought-provoking video: https://www.youtube.com/watch?v=JlRK1vqcuvg&feature=player_embedded
PS: This might be a little cheesy but don’t underrate the power of empathy.