A new startup I am working on got accepted to the Startup Showcase at eMerge Americas a few weeks ago. eMerge is a crazy big yearly conference and startup competition in Miami Beach this June. I think they say that 12,000 people will be at the Miami Convention Center across 3 days starting on June 12th, including Pitbull, Suzie Orman and 125 Startups.
Today, I received an email from an amazing startup, Tonomos, this week which has an amazing self driving vehicle product. The founder told me he had applied to the same showcase but did not get accepted. And what is crazy about this, is my team spent a few weeks to a month on a business plan and pitch deck and about 3 weeks on a software prototype to display what we are working on visually. The other startup, Tonomos, which I absolutely love their product, has put literally years into their autonomous personal vehicle, with tons of patents and it is so very promising.
So, why does a piece of paper beat out some serious technology for investor attention?
It’s simple. Tech by itself without a great message will never beat out a well written story with little to no tech.
Getting the attention of investors and customers (to the most part) is not about the tech!
And just saying how big a market is and you are getting it without describing a real product or service is also a big mistake.
For investors, it really is about the story, which could be a lot of things. It could be the market size, the people involved and their backgrounds, the milestones, numbers, downloads, our personal history or anything. In our case it is the message about what results the product/service promises to bring. People invest in the long term results that are projected from a technology, not a blob of clay sitting on the floor in the middle of a room without a name or brand. Tech by itself or a market by itself are pretty much non-starters for investors.
It is the whole story together with all the elements an investor needs to evaluate the startup.
It is the Why?
An investor needs to envision a path to success, revenue and understand why customers would accept a new technology. What promise does this product have and what can it do in the future?
A random looking computer board, a box or a generic mobile app with no story of why is not enough. There has to be a reason why they investor needs to take notice. And it is not about the tech or the market by itself.
What does the startup do today? What will it do in the future? And who needs it, why do they need it, what problem does it solve and are they already looking for it?
Answer these questions and a product will sell itself to investors. Also, being in the right track, right now for something big and contemporary always helps. It just happens our new startup is right in the middle of the AI, Machine Learning revolution, which is as hot as any investor area.
We just jumped into right pool at the right time, for now. That is what you should try to do with a tech startup (if you want to get investor attention).
Our concept is different, very different than anything out there. It is a niche, yet it applies to a very large market. In fact the market is enormous and almost every business needs it. So, that is another factor. Is it patentable? Yes, we think so.
The market you are going after needs to be big from at least one perspective. If it is a tiny market, then investors won’t care, unless the few customers pay out large sums of cash for it! If there are a few B2B or large payers, that is another way to be big.
What I am advocating here is spend more time on the story for startups.
What is your story?
How did you get here to this idea?
Why are people going to be interested?
Why are you going to be able to sell and scale and grow big?
What makes you different?
Do you have to give away the product for free and beg people to pay?
Can you not answer some or all of these questions?
This point is you need to be able to put together a cohesive pitch deck, which covers the 10–11 slides most investors are looking for. They are basically (in various orders), and:
- Why Now?
- Business Model
- Market Size & Scope
- Go To Market/Market Entry Plan
- What You Are Looking For
So, do you have all this info in a pitch deck ready to go for your startup?
And does it tell the investor a story and give them a good feeling that your business is real and is invest-able?
Get the pitch deck ready!
I had done quite a bit of startup consulting over the past couple years. I am no longer in that business, but if you have a specific question for me, I may be able to give you my opinion. And if you are interested in learning about what we are doing and why it was accepted for this Showcase, then just ask me and I will tell you about it if you need to know!
I always have a pitch in my articles. Today I am looking for a hosting or related tech company that is acquiring mobile app companies with some traction or revenue. I am also getting ready to run a Web Analytics/Google Analytics class in Boca Raton in the next few weeks. If you are interested in this subject, we will be running a class soon! Then the week of June 21st we are going to be running the next StartupPOP Tech Startup Pitch Event. It is not yet firmed up. Please join our Meetup here if you would like more information about June 21st or Web Analytics Training.
Tonight I will be on the panel at SPARK, another local Startup Pitch Event (May 11th, 2017, 6pm) in Hollywood, Florida, in Young Circle at the ArtsPark.
On Tuesday, May 16th, Maxeme Tuchman of Caribu.co will be pitching at Startup Grind Fort Lauderdale at Broward Community College, Downtown Fort Lauderdale. She will talk about her recent startup that let’s parents read books to their children remotely when on the road.
On June 1, StartupPOP will be running a Startup Pitch Event in Orlando at CatalystSpaces.