“If You Don’t Understand, I Don’t Have Time to Explain It.”
Two Big Reasons Why Big Brain Start-ups Fail:
1. They think smarts in one area automatically makes ‘em smart in everything else. Yes indeedy - and Einstein sometimes forgot to wear socks…in the winter…in Boston…
2. The founders confuse hubris with chutzpah.
You can miss a lot looking down from a high horse.
I’m an advisor for the TVC Equity Symposium, an annual event where hopeful entrepreneurs pitch to a room full of potential investors.
Recently, we had our dry run where each presenter goes through what is supposed to be a 10 minute pitch in front of all the advisors.
We grade each in several categories: Red (Yikes! Start ALL over!), Yellow (Needs Work), Green (Ready to Go!). Now, I’m a tough grader, having worked with a lot of start-ups and VCs. But, even so, I don’t give many “Rs.” I gave all “Rs” to one fellow, “Acme Widgets.”
Among other reasons for his Big R card, when someone in the audience recommended he better define a technical term, he said, “If you don’t understand it, I don’t have time to explain it.”
He then went on to say it would simply take too much time to explain the term…so he believes the potential investors “either get it or they don’t. Sorry.”
The two-word term could actually be easily defined in civilian language. This would, however, require “Acme’s” founder to get down off his high horse.
It’s not the job of VCs, or bankers, or customers to work at understanding why they should open their checkbook.
“Getting it” is directly related to how well you present an idea. I do a lot of work in “Acme Widget’s” industry sector and I had a hard time understanding what they did, much less get even a glimmer of why they’re better than what’s already out there. (There is ALWAYS something already out there.) Plus, there are some major market factors that the presentation didn’t consider at all which told me that while “Acme” may be tech superstars, they haven’t got clue one about marketing.
And here’s more advice that the TVC teams give (over and over) and many presenters Just. Will. Not. Take:
1. Lose the jumping, flashing, hopping animation. If the audience is trying to follow the bouncing ball, they’re not listening to you. (This applies to any type of presentation. And, if you’re trying to make up for lack of content with glitz, people will know.)
2. Less is More. If they’re reading dense text, they’re not listening to you.
3. Slooowwww Down. You can’t tell people everything in 10 minutes. Hit the key selling points (Yes, boys and girls, you’re selling here.) If you can’t get the “WOW!” across in 10 minutes or less, you’ve got a lot more work to do.
4. A patent (or idea) isn’t a product. How are you going to get that whiz-bang thing from the lab to the real world?
Related Post: Investors Are People Too.
Read More:Want Funding? Think Like An Investor Ten quick tips, based on my experience with VCs and start-ups. (one-page PDF)
Tags: start-up funding, entrepreneurs, entrepreneur sanity check, Technology Ventures Corporation
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May 6th, 2008 at 3:58 pm
I went to a similar event last Friday. The other problem 3 presenters had was defining a specific market that they would be focused. When pressed they kept saying “But everyone can use this”. Not understanding you cannot be all things to all people. And no, their baby wasn’t ugly but it sure could use a washcloth.
May 6th, 2008 at 6:27 pm
One of the best things I’ve ever been taught regarding presentations (or any info dump for that matter…) is “So What?”.
Answer that question honestly and *brutally* and it’s amazing how rapidly you can streamline anything.
…. except ones own comments in someone else’s blog. Naturally.
May 7th, 2008 at 7:35 am
Steve,
Yep, I call it the “So What” test when I’m talking to techies with the next world-shaking idea. By about the third “so what?” leaves them blank, we can get down to the real work. (Why would anybody buy it? Would they buy more than one? How is it better than what’s already out there? etc.)
May 9th, 2008 at 7:15 am
[…] Here’s a thing I read yesterday: … when someone in the audience recommended he better define a technical term, he said, “If you don’t understand it, I don’t have time to explain it.” […]