Half Engineer / Half Business Guy

Starting Your Business And Becoming An Entrepreneur

Tag: Pitch

Building A Screencast (“Canned”) Demo Video

WHY WOULD YOU NEED A Screencast Demo?

There are many places you’ll want to live demo your product, but also a number of situations where a demo video will be preferable.

Examples include a walk-through video on your website’s front page for first-time users of your site, or an investor pitch before you’re comfortable running the working version of your product live.

At a very early stage, if you don’t have your web product built out enough to be viewed, but your product is novel, a screencast demo may be a good way to show an investor what your product “feels” like, rather than just giving them an idea. It’s much easier to fall in love with a product when you get to see it in “use”, rather than look at a screenshot or just have it described to you.

Just to make this demo, you’ll have to do at least some UI/UX design and testing, rather than just visual design. (In this post on UI/UX design, I describe various ways to mock up a site)

You Don’t Have To Hire Someone (wHEW!)

Fortunately, it’s actually pretty simple to do yourself with one of a range of tools built specifically for screencast creation. Paid tools I’ve been recommended include Screenflow, Camtasia, and iShowU.

However, I went cheap-o, and loved the results: Screencast-O-Matic. It’s not the most beautiful website I’ve ever seen – but $9 for a year with the Pro account did the trick. The best thing about it (aside from the name) is the simplicity of the interface. It’s got just a few features, and they are the exact ones you need.

Unfortunately, the microphone on your computer sucks, and it will be very obvious you used it when you crank your demo volume up for a room full of listeners and you’re bombarded with whirrs and buzzes. Get a decent mic for your demo (if you’ve got a solid headphone/mic combo this can work too).

What should you include?

In total, your demo should be between 1-2min. You should show:

  1. The Core Features that define your product. E.g. if it’s a travel search, show travel search, which is: Enter city, enter dates, hit “Search”, get results, see detail and buy
  2. The Wow Factor – Make sure this is a real “Wow”. Don’t go crazy here showing a bunch of mediocre details, which happens WAY too much. Pick a couple of killer moves. E.g. Show a truly amazing deal your site can find, or some feature that no one has yet.

You’re going to want to add detail to show everything that you can do – but that’s for the next meeting and the next demo. Don’t BORE them! VC Mark Suster puts it well:

“DO NOT make it a features & functions presentation. Unfortunately most people do…Lame. You’re showing them features, not value. Value is when you frame the demo in terms of why it solves somebody’s true pain point.”

The best way to get this down to the core points is to write a script. If you just try to walk through your site on the fly, it’s easy to show too many features, and not hit your points hard. Write a script, then reduce it down to the Core and the Wow Factor, and expect to record multiple times and refine.

My final tip here – talk while you’re recording the visual part of the demo to keep pace, but voice it over later. You’ll sound much better.

BE EXCITING

As Mark Suster mentions in his post, there are a TON of bad demos out there. Avoid walking through your product and checking boxes with a monotone “and then you do X, and then you do Y, etc.

Content:

The best way to build your demo is to build it like your pitch. Don’t just tell your listener what’s happening next, make them WANT that next step. Describe the problem, and help them feel the pain point your product solves. They should think “Damn, I really want to fix this…but how??

(If you’re giving an investor presentation, it should be woven in with your deck, where you present the problem, a description of your solution, then show your demo.)

In addition to the overall reason for your product’s being, you should be clear why you’re doing every little thing you’re doing in the demo. Don’t say “I’m doing X, now Y – instead say “I’m doing X, because I want to Z – and BOOM, there’s what I wanted”.

Style:

This is your product that solves this MASSIVE problem and is going to make A BILLION DOLLARS. Be excited about it for goodness sake! You don’t need to be a monster truck commercial, but avoid the monotone.

I also recommend using a bit of humor. Even the coolest product can have a boring part that needs to be shared. One that comes to mind is logging into your bank account with Mint.com – if I was investing, I’d want to see how you connect a bank account, but once I realized what was happening, I’d tune out as the presenter fills in some form. It’s a good time to crack a joke, make people happy and get the blood circulating.

MAKE IT BIG, FOCUSED, AND CLEAR

This is where the program you’re using really helps out. I have seen a ton of demos where people bring up their website on a huge screen, and absolutely nothing is legible to the audience. This makes for an incredibly boring demo, and people will quickly start checking email and ignoring you.

  • Big – Zoom in on the detail you’re talking about so the font is very readable, and the parts of your site that are unimportant for what you’re saying go away. However, you should leave some of “the rest” visible, so people still feel the context of your site
  • Focused – “Gray Out” the area around your focus area so people don’t get distracted by all the other fancy features still on-screen
  • Clear – Don’t show a bunch of power-user moves, keep it simple

As Always – Test And Refine

Just like your product, your pitch, and the rest of your deck, you should always test your demo with others and incorporate their input.

In particular, figure out which pieces of the demo don’t make sense to them, what they feel is missing, and – most importantly – watch their body language and figure out when they get bored, then make those sections better or remove them.

How To Make A Pitch Deck More Awesome

In a previous post, I detailed how to create the content for a killer pitch deck. In this post, I describe some of the more technical aspects of refining your deck, and how to make it sharper and harder-hitting.

USE THE “NO THINKING RULE”

Your audience should think about your deck as little as possible…they should only be thinking about your ideas.

Of course, you want them thinking about how much money they can make, or which portfolio company you could partner with. However, any time they’re thinking due to technical aspects of your presentation, it’s time they’re not listening to you, and making decisions internally that could hurt your credibility.

The “No Thinking Rule” Has 4 Parts:

  1. Tell a story
  2. Show, don’t say
  3. Keywords only
  4. Remove sticking points

Tell a story

Every slide should work together, and no one should ever have to think “why is this slide up?” You should be able to remove the slide content, say the title/main point of each slide in order, and be left with a cohesive, complete story.

After you’ve written each slide, make sure that the main point you thought about while creating your story is the obvious take-away, and hits quickly. If not, go back and refine.

Show, don’t say

Any time you can show something with a picture instead of words, do it. Examples include:

  1. Separate groups on a page visually – Who wants to read a 12-bullet laundry list?
  2. Use logos/icons to replace names/words – You’ll get your point across faster
  3. Use graphs to replace numbers – Numbers (especially relationships between numbers) are often easier to understand visually

Keywords only

You shouldn’t be writing prose, just include the important words. Instead of “Google’s specialty is spinning products out of large scale data aggregation and processing projects”, put a Google logo next to the words “Large Scale Data Aggregation”, and voice-over the rest.

Remove sticking points

Don’t distract your audience! You know when your computer freezes, and you get a “Not Responding” or a Beachball Of Death? It can happen to audience members too if you give them sticking points like these:

  1. “You’re wrong!” – If you write “Google sucks at search”, people will stop listening and start thinking of all the reasons you’re stupid
  2. “I have to do math?” – Only put numbers that directly relate to your point, or really simple, clear math. Don’t force your audience to make a mental leap
  3. “What is that?” – One confusing bullet point on a slide, such as an unfamiliar industry acronym, can distract an audience member for the entire slide
  4. “Did he mean…?” If a word you choose has a second meaning, particularly a dirty meaning, don’t use it. Even the grown-ups in the room will get distracted, even if just for a few seconds

Conclusion

Following the “No Thinking Rule”, you’re going to have a much more effective pitch deck. Your communication will be clearer, so your audience will waste less time getting distracted and have more time to focus on your story.

(This was a description of a deck’s more technical aspects – for the content of a killer pitch deck, see my post here.)

The Most Important Questions About Your Startup

Preparing your elevator pitch and pitch deck are going to help you fill out your business plan, and start to understand the core aspects of your business.

However, there are other questions, that aren’t directly assigned to a slide in your deck, that you’ll need to think through early on. Some will arise as typical follow-up questions after each presentation you give, and some will need to be addressed before you can successfully complete your deck.

THE MOST IMPORTANT QUESTIONS ABOUT YOUR BUSINESS (That aren’t in your deck)

I won’t get into answering all of these now, but here is a list of questions – in addition to those specifically assigned a slide in your pitch deck – that you’ll likely need answers for as you tell people about, raise money for and build your new business.

  1. Who is your target customer and why?
    • How will this shift over time?
  2. How will you acquire customers?
    • Already in the deck, but one of the most fundamental and complex questions in starting a business. You’ll need to go deeper than what fits on one slide.
  3. Why will someone pay you for this?
    • You’ve described how you intend to make money, but why do you believe it will actually happen?
  4. How will you scale your business?
    • When you hit 10k, then 100k, then 1M users, how will your technology/infrastructure hold up, and how will your strategy/customer acquisition tactics change?
  5. Why will your product be chosen vs. a competitor’s?
  6. And every entrepreneur’s favorite: Why won’t Google do it?

In addition, there will be a few questions specific to your industry or company that people will typically ask after you present. The best way to learn these quickly is to practice pitching and presenting your deck to folks who know your industry or the startup world well.

If you’re going to present, be sure to think through these questions ahead of time, and make sure you have clear and concise answers prepared. You may not have to go into major detail, but you don’t want to leave folks remembering an “ummm…” that hurts your credibility and suggests you haven’t fully thought through your business.

What questions am I missing? Let me know in the comments so I can continue to build up this post.

Writing Your Pitch Deck

Building a pitch deck is one of the best ways to make sure you’re answering the key questions about your business. There are a few standard formats you can use to make sure you cover the most important issues, one of which I will share a variation on later in this post.

Most importantly, make it short and sweet!

Would you want to sit around watching a presentation with a thirty page powerpoint deck? No. Now imagine if you were a VC and looking at decks was a major part of your job. They have even less tolerance, so don’t bore them!

Your deck should be 10 slides or less.

One good rule of thumb is Guy Kawasaki’s 10/20/30 rule: your presentation will be an hour, so it should have 10 slides, you should expect to present for 20 minutes (leaving 40min for discussion), and have no font smaller than 30pt (your audience shouldn’t be reading, they should be listening to you). Guy’s blog post on the subject can be found here.

Full disclosure: I don’t necessarily stick absolutely to the 30pt rule. In some cases, you can be concise with something smaller. (To learn more about making a deck awesome, you can read more detail in my post here.)

Another suggestion, from Fred Wilson, is to whittle it down to six killer slides. If you can communicate your business well in six slides, do it, but I would still recommend starting with a standard ~10 slide deck to help you think through the key issues of your company, then refine.

THE TEN SLIDE PITCH DECK

There are many variations on this theme, and two folks who often receive credit for this structure are Guy Kawasaki and David Cowan. (I’ll let them duke it out). This is my variation.

The Deck:

  1. Cover (contact info)
  2. Problem
  3. Solution
    1. Good place for a demo
  4. Business model
  5. Why you?
  6. How will you get users?
  7. Competition
  8. Who are you and why will you kick everyone’s butt?
  9. Timeline / milestones
  10. The ask (and routing #)

Cover page

On your cover page, make sure to include your name and contact info. Make this really clear so the audience remembers you and can reach you again.

Problem

As I mentioned in an earlier post on creating an elevator pitch, your audience isn’t sitting there thinking about how much they need your product. Your goal here is to set the stage so the audience gets emotionally involved and thinks “I wish somebody would DO something about this!” and your solution scratches their itch.

Make sure that your audience can relate to your problem statement. For example, the investor you’re speaking to may not “like, totally hate it when he can’t post his class notes to just his boys on his tumblr”, but will understand how painful it is when he can’t send a powerpoint deck to the LPs invested in his fund.

Finally – I recommend trying to be entertaining here. Presentations can get boring, especially if you’re a VC who listens to similar pitches so frequently. Make them laugh, make sure you give them something they can relate to emotionally, and jolt them out of slide monotony!

Solution

A description of what your product does to solve that problem.

Make sure this is concise and clear (for pitfalls, see my post on elevator pitches). Preferably, use visuals to make sure this hits hard in one glance, rather than making the audience read bullet points and think to put it all together.

Solution, Part II – Demo

During this slide, or just after, is a good time for a demo or screenshots. It’s good to show that you’ve made progress, and it will likely answer a lot of the “how will you do X” questions your audience will have.

Make sure your demo is quick and snappy. Don’t make a 3 minute video describing all your features. Test your video with people ahead of time and watch when they get bored. Then speed these parts up or remove them. This should be 1 or 2 minutes max.

Business model

This is the slide where you tell people how you’re going to make money. I recommend also including a market size or some data implying the market size.

However, don’t put a bunch of boring stats – your market size should pop (a chart, visual or large number). If your numbers are not impressive, find numbers that are, or you may have a larger problem than slide creation.

Obviously, you also need to put your business model on this slide. One of our mentors, Chris Savage (CEO of Wistia) said it best:

“Really, an early stage startup is an exercise in finding the business model. The next step is an exercise in scaling up as quickly as possible.”

As a result, you’ll probably have more than a few ideas for business models. Include the most compelling ones, as long as they have significant and realistic revenue potential. You want to show that your company has different paths to success, and that you’ve thought ahead to future revenue streams.

Why you?

This is where you describe your special sauce. Whether it’s a description of proprietary technology, or some other competitive advantage, you want to make sure your audience knows why you’re going to crush it.

How are you going to get users?

You may have a great idea and product in the works, but your customer acquisition (marketing and sales) strategy is one of the most important questions you’ll answer as you build your company.

In short, don’t tell people you’ve got Twitter and Facebook accounts, a lot of friends who would use it, and are going to get written up in TechCrunch, because this is code for “I don’t know anything about entrepreneurial marketing”. See my post here on customer acquisition for ideas.

Competition

Another red alert for investors or other entrepreneurial audiences is “we don’t have any direct competitors”. No one will believe you don’t have any. Almost every “new” business is a variation on an old theme, and these slightly different businesses are usually your direct competitors.

Describe the competitive landscape on this slide. Make it visual if possible, and be very clear about how your company and other industry players are different.

Who are you?

Here’s where you show how much your team kicks butt.

Don’t write full prose bios on here – just the interesting stuff. Names of previous startups, money raised, prestigious companies/schools/awards, etc. You want your audience to see a bunch of impressive words, not sentences to read.

This is also a good place to list advisors you may have.

One of the things an investor will be trying to understand on this slide is which skills your company is missing – whether it’s industry or functional (e.g. marketing, strategy) expertise.

Advisors or mentors with expertise in your industry or with skillsets where you are lacking are major assets, because they strengthen you where you may be weak, and their place on your team shows that you’re self-aware and willing to find and accept help where you need it.

Timeline / Milestones

This is where you show your investors your progress, what you expect to do, and what are your upcoming milestones.

This will give investors an idea of where you expect to be in a few months or years, and this information is valuable to help them understand:

  • …what their investment will return before the next round of funding is raised
  • …value inflection points and other times when investment should be discussed/made
  • …whether you understand how to set realistic goals

What you need, what’s next

Note: This can sometimes be combined with the previous slide.

You need to be able to tell an investor how much money you’re raising, for what uses, and how much they’ll get in return.

Your slide may only have a high level description of uses, but you should have a good idea about specifics (e.g. salaries, types of marketing you’ll spend on) to voice-over or respond to questions. As for what they’ll receive in return, this doesn’t necessarily need to be in writing, because it will be a negotiation, after all. You should be prepared to tell an investor how much equity they’ll receive, and in some cases (angels more than VCs), what kind of return on investment they’ll get. My post on technical aspects of raising money may be helpful here.

(If you want to go brash, I’ve read many VC blog posts suggesting that they’d like to see routing numbers or PayPal accounts on this last page, though I’ve yet to hear a specific successful story using this tactic.)

PRACTICE, KNOW WHAT TO EXPECT, AND BRING BACKUP

As I suggested in my elevator pitch post, you should practice your presentation of this deck in front of as many people as possible, get their feedback, and refine.

When you do this, you’ll begin to get used to 1) where you’re not comfortable and 2) which follow-up questions you’ll typically be asked.

To fix #1, just practice more!

To help out with #2, I recommend building backup slides on the questions you’re frequently asked. This will let investors know that you’re well prepared and that you know your company’s key issues. It will also make sure you’re not left giving a credibility-lowering “ummm…” that could have easily been prevented.

Good luck!

(For advice on making your deck more awesome, see my post on the No Thinking Rule here.)

How To Create Your Elevator Pitch

CREATING A PITCH IS AN ITERATIVE PROCESS

The Process:

  1. Build your pitch
  2. Say it out loud to others as much as possible
  3. Incorporate input and refine

One of the most important things you will do as a startup founder is build your pitch. You will tell it so many times to so many investors, customers, partners and friends that you just won’t care anymore. However each time, it’s your brand, and you want it to be clear and simple.

A mistake that’s often made by founders is describing the idea “correctly”. In the founder’s head, the pitch describes the business, and if an investor doesn’t understand, it’s because “they just don’t get it, they just need to discuss it more in-depth to really get it.”

Sounds reasonable – but it doesn’t work like that.

Most of the time, you’ll only get one chance with that individual before they make up their mind about you. If your pitch is too complicated, you need to refine it to something clear and easy to understand, so that your listener can decide if it’s something they even want to hear more about.

And what’s the easiest way to get it to that point? Practice, practice, practice, in front of as many people as possible, and incorporate their feedback. (Ask them to be mean!)

THE STRUCTURE OF AN ELEVATOR PITCH

Note that there will be many different circumstances in which you’ll give your pitch. Brief 15-sec introductions in large groups, 90-sec pitches to investors, even ACTUALLY GETTING STUCK IN AN ELEVATOR (happened to one of the Betaspring teams this year).

You want to have the key to your business boiled down to as few words as possible, and have some backup in case people want you to go further. Each bullet below should be very concise, generally not more than one or two sentences.

Your pitch should include:

  • The Problem
  • The Solution
  • Your Differentiator
  • Illustrate size of the opportunity
  • Your progress

…and be prepared for the follow-up questions you’re typically asked.

Note that the first three points make up the barest version of your pitch. You’ll likely give many pitches at this length, for example when a room full of entrepreneurs are quickly introducing themselves. However, it’s very good to add the next few pieces if you have the opportunity, especially if you’re speaking to an investor.

And finally – do not just recite your pitch! If you’re not excited NO ONE will be!

The reality is, you will get tired of delivering your pitch. But whether it’s the 10th or 10,000th pitch, it should be delivered with the same energy every time. Show people that you are genuinely excited by your business!

THE PROBLEM

The most important question a listener will have is “why do I care”? Even if you have an amazing product, it’s pretty clear that before your pitch, the listener is isn’t just sitting there, thinking about how much they need your product – you need to get them in this mindset.

A common way to describe the types of problems that a startup can solve are Vitamins, Advil and Morphine:

  • Vitamins – Your customer doesn’t need this or know they need this yet. (E.g. Foursquare – Still arguable if this is useful, but has a huge audience)
  • Advil – Customer has a mild pain point, your product helps. (E.g. iPod – Couldn’t carry all your CDs)
  • Morphine – Customer has a major point, you solve. (E.g. mobile phone – people needed to communicate outside of home/office)

The takeaway here is – you want your product to be morphine (or at least feel like it). The best effect is for your listener to have a strong emotional reaction and think “I WISH someone would DO something about that!”

Where I may diverge from the norm is that I believe in some cases, you should prepare different pain points for different audiences. As an example, the VC you’re speaking to may not “like, totally hate it when he can’t post his class notes to just his boys on his tumblr”, but will understand how painful it is when he can’t send a powerpoint deck to the LPs invested in his fund.

YOUR SOLUTION

This is where you state your product. It seems like the most straightforward piece of the pitch, but it’s often a mess.

It should take one sentence, maybe two, and it should extremely briefly answer 1) what you are and 2) so what – how does it solve the problem?

Common Issues include:

Forgetting to describe what your product actually doesYou illustrate the problem and what needs to be solved, but don’t actually say how your product solves it

  • Example: “Today, we are connected by social networks, but not in the XYZ space. We make XYZ more social by adding augmented reality.”
    • Any listener would want to know: “How?”
    • And since augmented reality is relatively nascent, you may have to explain this from scratch – using jargon doesn’t usually help
  • Better: “We provide an immersive social check-in experience for bars and restaurants. Leave a message or picture at a bar that only your friends can see using our app, and treat the wall of the bar like a Facebook Wall.”
    • This includes a brief description, an example, and to clarify, an analogy to a successful product almost everyone will know
    • This product may work in a much wider range of places, but this is the initial target market, and people can quickly relate

Getting into the detailsThough most venture investors are intelligent, they may not know anything about your product or market. You should describe your product so that anyone can understand – a customer, a referrer, a non-technical investor, etc.

  • Example: “We perform XYZ analysis on ABC servers using the 123 algorithm, originally described by JKL. Our servers are optimized to run this algorithm more quickly than any other current provider of this software, given our use of multithreading and load-balancing.”
  • Better: “We provide the world’s most powerful software to analyze the servers used by large companies like XYZ and ABC, created in partnership with the lead researcher on Google’s proprietary server analysis system.”

Saying “we’re going to…”It doesn’t matter if you haven’t finished building it yet, tell people what your business is, get them interested. Of course, be honest about progress, but capture your audience’s imagination first, then discuss milestones and progress.

YOUR DIFFERENTIATOR

Even if people feel the pain of the problem, and understand that you’re building the solution, there are always competitors. Listeners will want to know why they should use your product, and investors will want to know why you can do well despite those competitors.

You can do this in one sentence, e.g. “no other company has feature XYZ, or works as quickly”, but it’s going to be very dependent on your company’s “special sauce”.

ILLUSTRATE HOW LARGE THE OPPORTUNITY IS

This is more for the investors you may be pitching.

Give them a qualitative or quantitative reason why they should believe the market is huge. Make sure you keep it very simple, and don’t use numbers if you can describe it in a more digestible way. E.g. “There are more [our market] than [other, related, obviously huge market]”.

For example, knowing that there are 100 million diabetics in the world is not a helpful stat to show someone how much your product-for-diabetics is worth. Knowing that diabetics in the US spend more than $3B on the treatment your product is rendering obsolete is much more useful.

Keep this section short and sweet, and use numbers that i) are believable, ii) you can back up, and iii) very clearly illustrate the size of YOUR opportunity.

YOUR PROGRESS

If you’ve even got an alpha version of your product duct-taped together, it’s still farther than most people who’ve had the same idea, and you should make an investor aware of this.

Be careful, however, of making promises around specific future milestones. If you’re a technology company, be careful about promising a feature launch in X weeks, because you may find one last issue you want to fix, and don’t want to overpromise and underdeliver as your first impression.

HAVE THE KEY QUESTIONS IN YOUR BACK POCKET

As you practice your pitch, you’ll find that there are always a few common follow-up questions.

Typical examples include:

  • How will you scale?
  • How will you acquire customers?
  • Why will people pay you for that?

There are a huge number of questions you’ll have to answer eventually, but there will always be a few that most people ask first about your specific business. Make sure you have these prepared clearly and concisely, so you don’t end up with an “umm…” that could hurt your credibility and easily be prevented.

With these pieces in place, you’re on your way to solid pitch. To make it perfect, don’t forget to constantly SHARE and REFINE!