Can you sell your business idea in a seven-floor elevator ride?
You better be able to.
Pitch opportunities are being compressed. Investors have heard so many bad ones they just want you to hustle through that painful part so they can get to their 20 questions. Bear in mind that whether you’re pitching your business to angels, venture capitalists, customers or strategic investors, you will have less time to articulate your business out loud, period.
The 30-second elevator pitch, which I call the seven-floor pitch, is the hardest to nail: You’ve got the investor for seven floors and the core of your business must be communicated in that brief ride. If you try to pull out and show him a mobile device screen, it’ll look like everyone else’s screenshot, and you’ll probably blow your first impression.
Success is when the investor grabs your elbow, asks you to step off the elevator, and says, “Tell me more about your business!”
The elevator pitch should be the fastest, simplest, most easily understood summary of your business. And it takes the most amount of work. No, it doesn’t always happen in the elevator, but sometimes it really does. In fact, I started honing my ear for effective elevator pitches when I ran the elevators in the U.S. Senate, House and Capitol during college. Imagine being in the background as four-star generals and prominent K Street lobbyists fervently make their case to a Congressman during the elevator ride from the Rayburn subway to the gallery of the House of Representatives.
Entrepreneurs have the same challenge: trying to surmise and deliver the shortest, most succinct--and most convincing--description of their businesses.
CEOs should be precise when describing their businesses. Of the hundreds of companies I’ve coached, sometimes I’ll hear a great extended pitch right off the bat. But hearing the great elevator pitch at the beginning of a coaching session is the rarest scenario of all. It’s an extremely difficult skill to master.
If you are just launching, don’t try to start out by creating the elevator pitch. This is backwards and a time consuming folly. Indeed, the seven-floor pitch is probably the last pitch you will polish. Great pitches are an iterative process. Think of politicians who spend months talking to voters. They find their key messages, then they simplify, repeat, simplify and repeat. CEOs must do the same thing.
First, do what you do every day: Think about your business. Determine why you’re going to be successful. Maybe you’ve solved a cool problem by identifying a business opportunity. Investors want to know how you’re going to make money, so start your thinking there.
Somewhat counter-intuitively, you want to start by mastering your longest pitch, and work down from there. Start by crafting a 20-minute, 20 page deck. Get all your thoughts out on the canvas. It is your best first script. Include very tight statements like: "I'm looking for X amount of dollars; this is what our business does; our go-to-market strategy; the competitive environment and how we're different. Define and articulate the revenue streams to illustrate your business model and how you will make money. List a couple business milestones you've already accomplished, define a few down-the-road milestones, and as the closer, tell them a little about your team.
From the 20-minute pitch, you will simplify to the 10-minute pitch, to the five, down to the two-minute and finally the seven-floor, 30-second pitch. (My LinkedIn has a deck template and recommended order of the script.) You’re boiling the business down to its most compelling essence. Never forget: Each pitch is an audition to be a CEO in an investor's portfolio.
Now, can you step off the elevator and tell me more?