Advice on Pitching your Startup to Venture Capitalists by Peter Thiel
Repost from Peter Thiels Post
- Insist that you pitch in the morning. Don’t turn off the lights during the PowerPoint presentation.
- Venture Capitalists See a Lot of Pitches. Make yours unusual. Add jokes.
- Pitch to Junior Associates, Not to Senior Partners. Because the former need good deals to add to their name, otherwise they won’t become senior partners, while the latter are wealthy and won’t care much.
- Show the Venture Capitalists how Your Deal is Oversubscribed. They don’t want to lose a deal to the competition.
- Keep the First Pitch Simple. You’ll have to pitch again anyway, so you can get into details then.
- Pitch When You Don’t Need Money. That’s when you’re strongest. The average financing takes 1-3 months anyway.
- The CEO is the One Who has to Pitch. Larry Ellison and Warren Buffet still do it.
- Avoid the Sstandard Pitch Format (“Facebook for dogs”). Instead, make an affirmative statement like SpaceX: “Launch costs haven’t come down in decades. We slash them by 90%.” Formula: problem + solution = money.
- Before the PowerPoint, Tell a Quick Story; people like them. Proof: Hollywood. format (via Aristotle): logos (rational argument) + ethos (your character / credibility pitch) + pathos (appeal to the listener’s emotions).
- Have a deck to be emailed, info-rich, with text that a junior analyst can plagiarize, and a deck to be presented live. Underline key words or phrases.
- Never ask for an NDA (Non-Disclosure Agreement). Just kills the Deal.
- Break Away From the Deck Quickly. Organic conversation is better.
- The Business Model is mostly a work of fiction for young companies, because it will most likely change. But be able to talk about revenue, sales processes, customer acquisition, and barriers to entry/exit.
- Have a Clear “Ask”. What’s your burn rate and what do you need the money for? Discuss valuation in the second pitch at the very last.
- You’ll Want to Pick Someone in the Room to be your Evangelist. You need a champion in the Venture Capitalist firm, or else your deal will die.
- Once You Close the Deal, Get the Press Release Out, get the VC logo on your site and yours on theirs.