Inquiring minds want to know... well done.
You just finished your eight-minute pitch. You were in the zone. You knew your stuff.
Now comes the hard part.
If you’re lucky, you’ll be bombarded with questions.
In many ways, your pitch is simply an opportunity to inspire potential investors to ask questions by telling them a great story.
Engage them in the beginning with the problem, wow them with the market potential, and impress them with the simplicity of your product and clarity of thought.
And when they start grilling you afterward realize you have already won. You are already at the next conversation; you just have to have really good answers to their questions.
The other day I was at a pitch event acting as a judge and I asked a question about why bitcoin and blockchain were finding their way into a pitch about earbuds that stimulate the brain.
The earbuds themselves were a stretch, relating them to blockchain transactions was incomprehensible.
He told me I just couldn’t understand. His point seemed to be to encourage me to write a check for something because it was so complex that I couldn't possibly be able to understand it.
Another woman at a screening was facing some tough questions about her business model and how we would make money. When we asked her directly how exactly we would make money.
She told us to ask our accountants.
I could go on and on – needless to say, these pitches ended right there.
If an investor is asking you a question about your company, your pitch, and your product you have done your first job. You have piqued their interest. They are bothering to use a few of their precious calories to fire up some brain cells to give some thought to what you are doing.
Don’t blow it.
Defensiveness, rudeness, absurd answers, all just stop the conversation right there. And there is no need for it. Here are a couple of things to remember:
1. Be happy they are asking questions, the harder the better because that means they are really thinking through the challenge you present.
2. Be prepared. I advise people to have a ten-page deck and 100 pages of backup slides. Think about how incredibly impressive it is when you can pull up the slide that answers the question.
3. Stay on topic. We don’t need war stories or tangential details – stay within the confines of your story, and provide concise focused answers.
4. Don’t be defensive. I know I shouldn’t use negatives, but what is the positive for not being defensive? Whatever it is, do that (and please share the word with me).
Defensiveness never helps; open and transparent works much better. If you made a mistake just own it and move on. That is much more powerful than defending something that makes no sense.
5. Admit when you are stumped. I for one will ask questions until you don’t know. I want to probe the limits of what you have thought about. I know you haven’t thought about everything so at some point you are not going to know the answer. That is okay. Own it and offer to find the answer.
6. Follow up. If you promised an answer for something you didn’t know or a correction to something that was wrong be sure to follow up with what you promised.
Just that will put you in the top 5% because 95% DON’T FOLLOW UP.
It seems simple. But the vast majority of the time when people can’t answer questions, even after delivering a good pitch, it’s because they blow it with one of these six mistakes.
So avoid them and be prepared.
After a thousand pitches I thought I’d start sharing some of my lessons. If you like these stories please let me know. Download my pitch guide and learn more about how to prep for investor pitches here.