Every entrepreneur must recognize this situation: you’re on a networking event or birthday party and a possible investor asks you: ‘What is your business about?’ Within one minute you should tell an appealing story that keeps the listener focused and make him or her understand your business case: the elevator pitch!
According to Wikipedia an elevator pitch is a ‘short summary used to quickly and simply define a product, service, or organization and its value proposition’. The name “elevator pitch” reflects the ‘idea that it should be possible to deliver the summary in the time span of an elevator ride, or approximately thirty seconds to two minutes’.
I’ve been browsing the web for some time to compile the best tips and tricks for the best elevator pitch. One of them is Chris O’Leary’s ‘Rule of the 9 C’s:
1. Concise – An effective elevator pitch contains as few words as possible, but no fewer.
2. Clear – Rather than being filled with acronyms, MBA-speak, and ten-dollar words, an effective elevator pitch can be understood by your grandparents, your spouse, and your children.
3. Compelling – An effective elevator pitch explains the problem your solution solves.
4. Credible – An effective elevator pitch explains why you are qualified to see the problem and to build your Solution.
5. Conceptual – An effective elevator pitch stays at a fairly high level and does not go into too much unnecessary detail.
6. Concrete – As much as is possible, an effective elevator pitch is also specific and tangible.
7. Customized – An effective elevator pitch addresses the specific interests and concerns of the audience.
8. Consistent – Every version of an effective elevator pitch conveys the same basic message.
9. Conversational – Rather than being to close the deal, the goal of an elevator pitch is to just set the hook; to start a conversation, or dialogue, with the audience.
According to Elloit Loh the basics of an elevator pitch are this:
We solve [problem] by providing [advantage],
to help [target] accomplish [target’s goal].
This video explains the trick within two minutes (the maximum length of an elevator pitch!)
OK, so when you sit down to write the text of the pitch you should ask yourself: What are the 10 questions I must answer?:
1. What’s the idea? Briefly describe what it is you sell. Do not go into excruciating detail, just the basics!
2. What’s the status of the idea or business?
3. What market or markets does the business address and are there any testimonials?
4. Why do you believe you have the advantage in the marketplace relative to the market needs?
5. What’s the competition in the marketplace? Briefly discuss who they are and what they have accomplished. Successful competition is an advantage-they are proof your business model and/or concept work.
6. What’s the revenue model? More simply, how do you expect to make money?
7. Who’s the team that’s going to make the business succeed? “Bet on the jockey, not the horse” is a familiar saying among Investors. Tell them a little about you and your team’s background and achievements. If you have a strong advisory board, tell them who they are and what they have accomplished.
8. What’s the longer term vision, the “end-game,” for the business and the projected return on investment for investors?
9. What’s the total funding required to execute the business plan?
10. What amount of financing are you seeking initially and what are the terms of investment?
When you’ve answered these questions, think about what your pitch must contain:
– A “hook” – Open your pitch by getting the investor’s attention with a “hook.” A statement or question that piques their interest to want to hear more.
– Passion – Investors expect energy and dedication from entrepreneurs.
– A request – At the end of your pitch, you must ask for something. Do you want their business card, to schedule a full presentation, to ask for a referral?
So when you have prepared all of this, there are two last tips: Keep it fresh and always be prepared! Adjust the pitch to the person who is listening, and refine it as you and your business continue to grow and change.
Do you need inspiration for writing your pitch? See one on the bottom of this page!
If you have a meeting with an investor, look at these tips to create a great presentation.
OK, that’s it! And we end with an example on how to NOT to do an elevator pitch! :-)