What is the magical secret to a great VC pitch?

originally posted on Medium.

Dear Heidi,

I have a killer app that I think is going to be HU-U-U-UGE. I’ve been working on it every night and weekend for the last six months, and I think I’m ready to take the plunge, raise some money and quit my job to work on this full time. Here’s my problem, every time I open up PowerPoint to start my pitch deck, I find myself endlessly scrolling through templates with a blank mind and a sense of dread. Truth is, I have no idea where to start. So help me out with this Heidi, what is the outline for a great pitch?

— Worldessly Waiting, Woodside CA

Dear Wordlessly Waiting,

Ah that demonic blank page — anyone who has ever had to write anything knows that cold feeling. Let me see if I can help break the ice for you.

Truth is, there isn’t a single perfect pitch, because in order to capture your unique opportunity, no cookie-cutter approach will be exactly right. Searching for answers on the web may surface some useful archetypes — one of my favorite compendiums is here, another great one here. But if you want my personal opinion from twenty years of sitting in those meetings, the ones that have compelled me to pony up the dough have all shared the same core elements.*

Here are the components to a compelling pitch:

Tell me about the problem you have identified. It is helpful to tell me what the problem you are trying to solve is, and how you discovered this. Did you experience it yourself? Did you work for a company where this problem was rampant among the customer base, but the company did not have an interest in solving it?

Show me how big this problem is. I hope it’s really, really big, because solving small problems is typically not a good venture bet. Tell me how many people have this problem, and what they’d be willing to pay to solve this problem. This is even more compelling if you have data from real live customers who’ve already voted for you with their dollars or at least a firm expression of interest that they’d be willing to talk to me about too.

Why are you and your team the very best people in the world to solve this problem? What is it about you that will give you the superpowers to create the first iteration of the product, learn from interactions with your customers, and manifest all that into something that will be the foundation of a big, big company? Oh and also, why this is so important to you personally that you will see it through years of challenges if given the opportunity to do so?

Tell me how you are going to actually solve the problem. What is the product, how will it work, when will it be ready, and how much will it cost you to make it?

It would also be good to explain why now is the time. What has caused this problem to manifest itself as huge and what has now created the primordial soup out of which you can craft the solution? Why couldn’t it have been tackled before now?

How about competition? Along those lines, if this is such a good idea and time, who else is doing something similar, and why do you think you can still succeed in light of their existence?

I’d also like to know how you are going to make money. What is your business model? What are its key metrics? How will you cost-effectively acquire customers? How fast do you expect you can grow? How much money are you raising now and what do you plan to spend it on? What do you plan to accomplish — IE what will your company look like in terms of metrics achieved by the time you need to go raise more money? And, how much money do you plan to spend in total before you start making money? Call me old-fashioned, but I personally like to invest in companies that ultimately know how to make a profit!

Last but not least…tell me why you picked me, and what you need from me (besides money!) as your partner on this journey. Why am I the right person (and my firm the right team) to invest in you? What help do you want from us?

Throughout all of this, remember, you are telling a story. We humans love stories, we can’t help ourselves — and stories have been used throughout the ages to compel people to act. While we are going to evaluate the opportunity on whatever metrics we can get our hands on, often in early stage venture investing there just aren’t that many metrics, and so part of the evaluation comes down to how compelled we felt by the story and by your telling of it.

While all of the above are valuable components of your story, the order in which you tackle them is yours to decide. Some people start with their own bona fides first, some start with a personal story about the discovery of the problem, some start with the solution itself. In order to find your best flow, you might want to take each one of these and work it into a slide’s worth of notes, then draft a few friends to listen to you combine all that into a tellable story. I’ve found after a few practice runs the story arc will become clear to you.

I hope that helps, and I look forward to hearing your story!


* I’m approaching this from my perspective as a professional investor in a multi-hundred-million-dollar fund specializing in early stage/series A companies. Because of that we look for very big opportunities and my comments accordingly reflect that.