The Entrepreneurial Race Part 4: Getting Sponsors
August 13, 2013 4 Comments
This is the fourth post in the “Entrepreneurial Race” series. Click here to read Part 1: Getting to the Track (funding options), Part 2: Picking a Pit Crew (selecting a Board of Advisors), and Part 3: On Your Mark, Get Set, GO! (launching).
Race cars have a lot of stickers on them. Each one represents a sponsor that has paid to have their logo placed on the vehicle with the expectation it will be seen in person, online, on TV, in a magazine, and in other images of the vehicle. The sponsorships help the race teams to pay their drivers and pit crews as well as cover fuel, tire, and maintenance costs for the race car.
Most entrepreneurs need to enlist their own sponsors at some point in their startup lifecycle. In order to get “stickers” on their startups to cover costs and accelerate growth, the founders must go out and pitch their businesses to potential investors [for more on four different funding options, check out Part 1 of this series].
Pitches can range in length from a one minute elevator pitch to a 15-20 minute investor presentation. Regardless of duration, any effective pitch should contain these six elements:
- Overview- introduce your company, team, and big idea in a captivating manner
- Problem- layout the pain point you are trying to relieve and why it needs to be addressed with compelling statistics
- Solution- present the way that you solve the problem in a unique way with a thorough explanation and a demonstration if possible
- Market- demonstrate that there is an addressable market (size, growth, etc) and show how and to what degree you will penetrate it
- Model- explain how you will make money and outline your future plans (R&D, HR, new products/services, exit scenarios, etc)
- Ask- detail the funds/resources you need in order to achieve future milestones and have a plan for using the funds
Addressing these six elements will give your audience a general idea of what you company does and the value creates. Remember that you don’t have to give all the details, but always give enough info to answer the basics while provoking meaningful discussion after the presentation.
Once you have the content of the pitch to potential sponsors nailed down, you need to figure out how to present it in a concise, memorable, and relatable manner. Here are a few presentation tips:
- Simplify everything- Your pitch should be simple enough that it passes the “grandma test.” In other words, could you give your pitch to grandma and have her be able to grasp your main ideas. This is especially difficult for a sophisticated computer program, app, or technical product, but it is essential. Most of the audience, even investors will not have the intimate knowledge of your market that you do and any industry jargon will only cause confusion.
- Be Confident- Remember you are the only person in the room who is intimately involved with your business. You know it inside and out. If you mess up, just keep going like nothing happened and no one will notice. Trust your knowledge of your company and let your passion shine forth.
- Support with Visuals- It is important to emphasize support with visuals; don’t rely on visuals as your crutch. Too often presenters overemphasize their PowerPoint or read exactly what it behind them. A powerful visual gives the most essential information (or graphically represents the information being discussed) and allows attention to stay on the speaker.
- Practice- This may sound obvious, but it is often overlooked. You want to practice your presentation enough that you can have it memorized but not seem unnatural. Don’t just practice your words, but also your body language and movements. Start by practicing in a mirror and then do it in front of a friend, family member, or coworker.
By combining meaningful content with a memorable presentation, potential sponsors will be clamoring to get their logo on the side of your car. Telling a compelling story about your product and company will set you apart from the competition and enable your team to race around the track on the way to building a successful business.
Need some examples of both good and bad pitches? Here are a few elevator pitch examples from a competition in Northwest Arkansas (including mine for Agricultural Food Systems) as well as an elevator pitch competition at Rice University.
Learn It. Love It. Live It.
[image credit: Rowan Harrison on Flickr]