SXSWorld
Issue link: https://sxsw.uberflip.com/i/427724
2 0 S X S W o r l d | N O V E M B E R 2 0 1 4 | S X S W. C O M he myth on which startup culture is founded is that all it takes is just one great idea to change your life. How many times have viewers watched Shark Tank to wit- ness wannabe entrepreneurs biding for investment, and wondered why they didn't think of that idea first? In truth, persuading a panel of wealthy tycoons to part with their cash is a tricky, nerve- wracking task that all boils down to mastering the art of the perfect pitch. "Today, it's not enough to just have an exciting idea," says Martin Soorjoo, founder of The Pitch Clinic, which helps startups win investment of any where from $1m-14m. "Around 90% of pitches fail because the company presents potential investors with a data dump. You can't come up with a truly inspiring pitch if you haven't sat down, shut off social media and had quiet time in a creative space." Soorjoo's words are echoed by one of the winners of this year's SXSW V2Venture pitch competition (held in Las Vegas in July), a medi-tech company named eTect. Their product is a digestible, wire- less sensor planted on a medicine capsule, which sends a signal when the medication has been taken. President and COO, Eric Buff kin, impressed the live audience with a two-minute, high-energy pitch that brought this complex scientific concept to life. "I have seen some brilliant people who are terrible at pitching but excel at making money," says Buff kin, who has more than 20 years of experience in the wireless tech and communications sphere. He estimates that he has pitched for venture capital around 200 times, raising over $150m for a range of companies. "A successful pitch has three essential elements: a good story, the right person telling that story and an idea that immediately hooks the audience." Buff kin's involvement with eTect began five years ago after a chance meeting with the company's founder, and he has assumed the role of the company's public face. He believes that that one person should focus on the pitching, leaving the rest of the staff free to focus on evolving the business: "A key part of the pitch is about building a personal connection with the audience. Think of how Steve Jobs executed each new Apple product launch—the attention was fully on him and the background was always simple." The ability of a pitcher to spin a beguiling story from a dry, data- heav y business plan, while condensing the idea into the allotted timeframe, are skills both Buff kin and Soorjoo agree are crucial for success. "There's an old saying in the south that you can only put so much lipstick on a pig," drawls Buff kin. "Part of reason we were successful at SXSW V2V is that our story is compelling. I grew up in a small town in Florida— the best storytellers were the church preachers who engaged audiences with just the right amount of passion and empathy. I try to bring elements of that into my ven- ture pitches. But, the biggest challenge is trying to convey that story comprehensively in two minutes." "Doing shorter presen- tations is much harder," says Soorjoo. "Mark Twain famously when asked by an editor to do a two-page article in two days replied; 'No, I can do a 30-page piece in two days, or a two- page piece in 30 days.' With shorter 'elevator' pitches, there are three key elements: what's the hook, how much traction does your idea have and what's next? If you can show a potential investor that you already have 10m users and could generate $1m in revenue, then you have a real shot at winning them over." The perfect pitch requires rigorous preparation. eTect's prize- winning presentation endured a last minute rewrite after falling flat in rehearsal, the day before the competition. "The original version stunk," says Buff kin emphatically. "We had developed a formula and thought we would add some video. Our concept was to intro- duce eTect, roll the video and finish with a 30-second discussion. The video, which had seemed brilliant when we watched it previ- ously, was complete dead air in the pitch. I went back to my hotel and rewrote the entire thing." Eight million viewers might tune in to witness the public humilia- tions endured by budding business moguls on Shark Tank, but how do you handle it when your dreams are being crushed? "Prepare yourself for rejection many times over," says Buff kin. "Let it roll off your back, but also question what might have been different. Ask yourself, 'Was the rejection caused by our story, our team or is it simply not the right fit with the investor?' " Those wanting to avoid crashing and burning would do well to heed Soorjoo's more psychological take on how to achieve pitch suc- cess: "The brain can't run emotion and logic at the same. I always tell my clients that investors are less likely to ask difficult questions if they are emotionally engaged. I know many VCs who have parted with vast sums of money and afterwards thought—'what happened there?' " So, there you have it—the perfect pitch requires preparation, a powerful story and the ability to make grown men (and women) shed the odd tear. "Doing a good pitch is not an adrenaline high," says Buff kin. "It's more like having a great conversation that you reflect on for days after." Compelling Stories Crucial for Winning Business Pitches by serenA kutChinsky T E ric B u f f k in (ce n te r) of eTe c t a t SX S W V 2Ve n tu re J E S S I C A C O X