🙅🏽♀️Avoid These Mistakes When Pitching VCs (1/2)
Professional investors are looking for very specific things in founders at pre-seed. Here are some common mistakes, and how to repair even after they've happened
Hi Founder 👋🏾
First want to say a HUGE thanks to each and every one of you who read this newsletter. You’ve have read, liked, shared sent kind words on how the resources we share here is helpful. This keeps me going so, keep your feedback coming.
If you haven’t seen this resource, HERE is a list of 100+ pre-seed/ seed funds that invest in Africa.
One of the reasons i started this newsletter is because of the problem of the information divide between founders and VCs. I’ve seen incredibly smart founders, make very simple mistakes when pitching VCs.
I think founders are the heroes of the story. It is HARD to build anything and i know this because even though i’m an investor, i’m a builder at heart, having operated and scaled several multinational technology startups.
Because of this respect and connection i have for and with you incredible founders, i decided to share my knowledge. As a pre-seed investor that’s invested in the US, Africa, South East Asia, and Europe, I’ve seen thousands of decks from founders across continents and cultures. I’ve spoken with so many founders i’ve lost count.
These are some of the most common mistakes i’ve seen. They seem simple but a combination is why a VC is likely to say a quick no. I’m also going to share some suggestions on how to repair it even if you’ve made the mistake
🗣️ Speaking for Too Long At A Time and Rigid Pitch
Usually, the initial pitch call is around 30-45 minutes, and you’ve shared your deck before hand. As a founder, i can imagine how stressful it is, and you might think it helps to follow the slides how you’ve practiced it.
However in real life, the best pitches are conversations and no pitch is exactly the same. Take a more flexible approach instead. Try not to regurgitate the information you’ve prepped at one go. Make it a conversation. If they have the deck, assume they are looking at it, and as you speak, you can refer to certain slides. It’s fine to present your slides but give some room for investors to ask questions and for you to respond.
Let some silence in-between the conversations and use a conversational, not “pitching” tone. One tip is to speak for 1-2 min bursts at a time. Let the investors speak and ask questions, and listen to both what they are saying and they aren’t.
How To Repair: If this happened to you on a pitch call, it is likely the investor wasn’t able to ask their questions and you ran out of time. You can send a follow up email, sharing an investor FAQ document, including questions investors have asked and a detailed response. You could also express that you’d be happy to answer follow up questions via email, and or jump on another quick call to chat.
📡 Focusing on Product and Unclear about Distribution
There’s a popular saying;
“The first time founder focuses on product, and the second time founder on distribution”
It is very tempting to focus only on building a product, and that if you build it customers will come. For your benefit, i’d suggest you find some evidence customers want are willing to pay before you build a product.
In fact, if investors are confident you can build a solution, they might be a bit more lenient and only focus on if you have validated that the market wants your solution and that you can acquire these customers.
Some founders have raised with zero product but have a healthy waitlist, and/or a signed pilot partnership LOI, or agreement that unlock a large volume of customers instantly when they build the product. Research is great but find more direct evidence of intent to use and buy.
Find cheap, quick, and scalable ways to unlock your initial sets of customers and show you’ve thought deeply about acquisition. Use numbers.
How To Repair: If this happened on a call, it is likely the investor is already thinking to pass. Send a quick email / document as a follow up sharing in detail what you intend to do to acquire these customers in the near future, and in addition, what you’ve already done to build a list of customers ready to go on day one.
👀Weak Long Term Vision
One question you’ll probably get is “What is the big vision? what does this look like in the future”. Now it is time to paint a very clear picture of a massive outcome.
Start with a one very strong liner that gives a clear picture, and also helps you articulate your thoughts. Paint your thesis of what your market looks like, and how you fit. Be very descriptive, and sell that future — such that they can see it very clearly in their minds.
Example: Paystack pitching in 2015
“In the next 10 years i believe we’ll power 9 out of every 10 transactions in Africa for small and medium businesses. On Paystack, businesses will set up their payment infrastructure and accept payments in seconds for free. Right now it takes a business 6 months and $500 upfront cost to set up online payments. In 10 years, i believe the average African business will sell online and Paystack will be their platform of choice. Online and also Offline. We want to be the Stripe for Africa*”
*This is just a sample and not their actual pitch
How To Repair: After the call, send an email. Share a loom video recording with your vision. Be descriptive, passionate, like you’re telling a story. Say it like you believe it. It also helps to mention that you aspire to becoming or surpassing a very large similar company focused on other markets.
I hope this helps, can you identify any mistake you’ve made? You can repair it with the tips above I’ll see you next time, where i’ll share a few more mistakes and how to repair.
If this helps you, share on your social media so we spread the word. Lets get this to 1,000 founders so they benefit from simple information that helps them fundraise smarter.
Speak again soon.
Maria
AfroPitchPrep