Warning: Half a Truth is Three Times a Lie
Entrepreneurs: think of yourself in a pitch situation. You’re talking to a small collection of people you don’t know. They’re taking notes. You’re talking and showing slides from your pitch deck.
I think you assume that on any subject you cover, there is at least one person sitting quietly watching you who knows a whole lot about that subject. Which means that a single half truth can sink an entire pitch.
I’ve seen this happen far too often. After the pitch is done, the pitchers exit, one of the investors still in the room points out a half truth. For example, somebody who knows about physical product distribution points out that the plan to get into channels ignores the power of the key distributors who feed the retail chains. For example, the conversion rate projection is way too high, or pay-per-click estimate way too low. For example, marketing costs as percent of revenue are about a fifth of the industry average. For example, competitive comparisons that have bad information in them.
What reminded me of this today was this piece on buying friends in Facebook. How do you look if you hinge one of your pitch points on success in Facebook against the background of spreading knowledge about way to manufacture that particular statistic. Which is also true of Twitter followers, with different techniques and even software packages to increase the number.
So how do you handle interruptions, and specific questions, when you’re pitching? What happens when somebody challenges you on a specific point? My suggestion is: Whatever you do, don’t pretend you know when you’re guessing. Ideally, break your assumptions down into their component pieces, explain where they came from, and be open to suggestions at that moment.
The worst option is to hide a guess with bravado and the face of certainty. Reasonable doubts are okay, assumptions are even better.
Written by Tim Berry
You might also be interested in
So you’ve developed a game-changing product, formed a business with a killer team, quit your job, and are rolling the product out to market. Your business is the next unicorn, and all is good in the world. Fantastic. Now only one thing is inhibiting your company’s growth: you have no money.
For many founders of high-growth startups, bootstrapping has limits.
With startup growth up 61% since 2014 and more investment programs emerging, it can be overwhelming for founders to know just where to jump in. As the most startup-friendly accelerator on the planet, MassChallenge has helped 835 startup companies around the world, who have raised over $1.1 billion in funding and created over 6,500 jobs. We have seen startups at
Kathryn Schifferle, Founder and CEO of Work Truck Solutions, turned being a woman in work trucks into an oversubscribed $2.1 million round.
We sat down with Kathryn as she shared what her fundraising journey was like, the startup lessons she learned, and her advice to fellow founders, especially women. Here is what she had to say:
Update 2017: To help you understand how your startup will look to investors according to this methodology, we’ve created a fundraising feedback tool that will give you investor-level insight into your startup’s performance. In just about 15 minutes, it will tell you how much money your startup is likely to raise, where you can find that capital, and what to
How to Make Your Gust Account Stand Out to Investors
Before you read any further, I want you to know that I’ve personally used Gust to raise money for my first tech startup. I know a lot of other entrepreneurs who use or have used Gust to seek funds, but their profiles don’t always get attention from investors. Below are