6 Foolproof Ways to Perfect Your Pitch
Entrepreneurs are never finished pitching. From the day they first sell friends and family on a pie-in-the-sky business idea all the way through to the IPO roadshow, entrepreneurs must continually craft the perfect pitch. The problem is, not all business owners are born pitchmen.
That's where Ron Shapiro comes in. As founder of the Shapiro Negotiations Institute, Shapiro is a renowned negotiator. He cut his teeth as a civil rights lawyer in Baltimore in the 1970s, negotiating for desegregated housing and protections for Vietnam War draft dodgers. His success earned him lots of local recognition, including from the Baltimore Orioles, who hired Shapiro to represent a bankrupt star player. Shapiro parlayed that experience into a successful career as a sports agent, representing the likes of Kirby Puckett and Cal Ripken Jr. Outside the sports world, he's been called on to end a major symphony orchestra strike and through the Institute, Shapiro trains clients including Bank of America and Verizon, as well as small businesses, in what he considers a foolproof style of negotiating.
Suffice it to say, Ron Shapiro knows how to get to yes.
In his new book, "Perfecting Your Pitch: How to Succeed in Business and In Life, By Finding Words That Work," Shapiro shares some of the lessons he's learned over the years about how to pitch.
"I write books not because I'm brilliant, but because I've made mistakes and learned from mistakes," says Shapiro, who has written three other books on negotiating. "I try to draw on those mistakes to help other people avoid them."
The book comes complete with some 40 scripts on how to handle different types of pitches, from pitching an investor to negotiating a pre-nup. Shapiro recently shared some of his time-tested tips for entrepreneurs with me. Here are a few:
1. Rule of thumb: Before you pitch, follow the three Ds
Shapiro will never forget the time he was representing baseball legend Cal Ripken Jr. and negotiating his contract. Shapiro knew that a basic negotiation strategy is to aim high, so he figured the proper ask would be $1.25 million. When it came down to negotiation time, though, Shapiro, then a young sports agent, let nerves get to him, and he asked instead for something between $1.25 million and $1 million. Instantly, that pushed the Orioles' offer to $750,000.
"I knew what the right words were, but I wasn't speaking them," Shapiro remembers. "I said, 'I've got to script the message out and practice it to be able to deliver it with confidence.'"
That's why the first D in Shapiro's model is "draft." Well before the pitch, Shapiro recommends writing down all the things you want to say, even if you don't plan on saying it in the end. The second D is "devil's advocate." By that, Shapiro means find a trusted friend or associate who will read your draft, revise it, and remove words or ideas that could be detrimental to your end goal. The final D is "deliver," which amounts to practicing the revised pitch out loud until you're confident you'll be able to deliver it clearly in person.
2. If you're making a sales pitch...
Potential clients are always going to ask business owners to sharpen their pencils and lower their prices. In cases like these, Shapiro says, research is an entrepreneur's best ally. Develop a thorough knowledge of the market, and find out what comparable products and services cost at comparable companies. Then, be able to describe to the client why your product or service puts them in a better position than those other companies.
"You're trying to reduce the buyer's insecurities about paying a price they're not comfortable with," he says, adding that facts and figures speak louder than anecdotes and subjective evidence.
Don't get defensive or overly pushy. Instead, ask a lot of questions about the customer's goals and be prepared to address those goals.
3. If you're firing an employee you really like...
Entrepreneurs aren't always pitching just to get something they want. Sometimes, the ugly parts of running a company, like firing employees, require just as much tact as a sales pitch.
Firing an employee you're fond of, for financial reasons or otherwise, can be the toughest day of an entrepreneur's career. To get through it, Shapiro says keep in mind that you must accomplish two things: acknowledge the importance of your relationship, but also the finality of the decision.
"The script should be something like, 'Our lives have been intertwined for years, and I view our relationship as special, so telling you now your work here has to end soon, isn't an easy thing for me,'" Shapiro says. Of course, conversations of this nature rarely go smoothly, so be sure to allow time for the employee to vent. "Always ask questions," Shapiro says. "Ask what's on their mind so you can restart a dialogue, even if you don't have all the answers."
4. If you're pitching an investor...
When it comes to fundraising, the most important thing to do is research the potential investor and try to find a reason why he might be interested in your company. Explain the impact the investment could have on your business, as well as the potential benefits to the investor and market size of the opportunity.
And most important, don't fall into the trap Shapiro did with Cal Ripken Jr. "Aim high," Shapiro advises. "Investors like to negotiate, and you need to be prepared."
5. If you're giving constructive criticism...
When you critique an employee, even the most constructive criticism can quickly become what Shapiro calls "destructive criticism," which shuts employees down. A more effective way to approach this scenario is to start with questions. Ask the employee how he thinks he's doing, what he likes and doesn't like about the job, what he thinks he does well, and what he thinks he could improve on.
Then, you can move to the area you want to focus on by saying something like, "I want to talk about how we can make you even more effective at what you do," Shapiro suggests. Framing the criticism positively is crucial. Analyze the employee's weak points, but only if you can offer specific suggestions for improvement.
Finally, conclude the conversation by asking, "Have I been clear?"
6. If things aren't going as planned...
"The script only goes so far," Shapiro admits. "It gets you through the key ask, but you have to be prepared for people saying things you don't expect."
If (or more likely, when) that happens, Shapiro stays stay calm and ask questions. Instead of getting flustered and speaking off the cuff, fall back on questions like "Can you explain?" or "Why do you feel that way?" The more questions you ask, the more you'll be able to direct the conversation back on track.
If that fails, don't be afraid to take a break and ask to revisit the conversation when you've given what was discussed more thought. "Understand that it's not going to be a matter of writing the script and ending the play," Shapiro says. "There's an epilogue and that's a little more extemporaneous."