How to Send Investors Running for Their Lives
If you follow the eight tips outlined in this entry, you will be guaranteed to suffer absolutely no dilution, as there is zero chance a reasonable investor will give you money. The prospective investors will remember your pitch for years, and anecdotes from your talk will liven up many a happy hour.
Relish the notoriety that these tips will help you achieve, and rest assured that you will never be saddled with troublesome investors. Investors are overrated. Who needs them?
1. Open with an offensive, off-color joke.
The great thing about beginning your pitch in an awkward manner is that you can alienate the majority of your audience quickly, making the fact that you are unprepared (as outlined in next suggestion) much less relevant.
In addition to being blatantly offensive, you will avoid establishing the proper context of your pitch at the outset. They will become confused and disengaged. Nice work.
2. Wing it.
Would you study for a test, train for a marathon or memorize your lines for a play? Of course not. Such preparation would be a waste of time. You are an entrepreneur--go for it.
If you need to fill any uncomfortable pauses, just utter brilliant sonic fillers, such as: "you know," "like," "ah," "let me be clear," "as I was saying," or the classic standby "ummm." "Um" is especially versatile: You can sustain it as long as you need to conjure your next rambling thought.
3. Obscure how you will make money.
Throughout your presentation, emphasize fluff over substance. Liberally utilize video, graphics and other eye candy that distracts from your pitch and is irrelevant to your venture's value proposition. If you are forced to display financial data, ensure that the slides are unintelligible. To further obscure how you will earn a return on the investors' money, verbally stumble through the description of your financial forecast and make it clear that you only have a cursory understanding of the assumptions underlying your business model.
To further weaken your credibility, speak in the future tense as frequently as possible (e.g., we hope to eventually complete our development, once we begin shipping product, etc.). The extensive use of the future tense will make your venture seem intangible and less real. The more generic and jargony you are, the greater the likelihood you will be perceived as an insubstantial dolt.
4. Do not put yourself in your audience's shoes.
You know that most professional investors listen to hundreds of pitches each year. So what? In order to deliver a particularly terrible fundraising presentation, disregard the fact that your audience is sophisticated and somewhat jaded. Make it clear you do not know their investment focus (e.g., early-stage, late-stage, market-sector focus) nor did you take the time to research the investor's investment portfolios.
One way to unequivocally convey your disregard of your audience's frame of reference is to tell them things they are certain to already know. For instance, emphasize basic market issues that are familiar to even the most casual observer of your venture's space.
5. Kill 'em with PowerPoint.
Deploy an extraordinary number of slides. You know, maybe 20 to 30 per minute. In addition, you can accelerate Death By PowerPoint in a number of ways:
- Hide behind a podium
- Avoid eye contact with your audience
- Turn your back to the audience and read each slide verbatim from the screen
- Limit the use of pictures or graphs on your slides
- Utilize extremely small fonts so you can maximize the amount of text per slide
- Select a complicated, distracting background that will compete with the slides' content
6. Apologize profusely.
Nothing more effectively conveys the sentiment, "I do not respect you" than an apologetic announcement at the outset that you are unprepared. You can also interject apologies throughout your talk, including: your unintelligible slides, your disheveled appearance, starting the presentation late, running over your allotted time, etc.
7. Evade questions.
Q&A can often make the difference between a mediocre and a compellingly bad presentation. Avoid preparing for Q&A. Do not anticipate questions or think through your responses in advance. You are winging it, remember? This includes Q&A.
Irrespective of a question's validity, approach each with an overt air of disdain. Never admit that you do not know something. If you are unsure of a factual response, make up a fictitious one.
In addition to playing loose with the facts, be defensive and argumentative if a question is too pointed. If the questioner persists with a follow-up question, provide a rambling, semi-coherent response.
8. Do not follow up.
Once the presentation is over, forget about it. If a potential investor asks a question that requires additional research, blow it off. In addition, do not bother tracking down the investors to solicit their feedback after the pitch. You are far too busy for such Tomfoolery.
JOHN GREATHOUSE | Partner, Rincon Venture Partners
John Greathouse is a partner at Rincon Venture Partners, an early-stage VC firm. A serial entrepreneur, John led Computer Motion?s $110 million public offering, and the $236 million sale of Expertcity (creator of GoToMeeting) to Citrix. Check out his hands-on start-up advice blog at Infochachkie. Or, follow his start-up oriented Twitter feed, where he promises not to tweet about koala bears or killer burritos.