#23 — What investors actually want from your early-stage startup pitch
June 11, 2024•2 min read
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Why it matters: Your ability to pitch effectively determines access to capital, talent, and opportunities. Most founders struggle with this critical skill.
The big picture: Investors see hundreds of pitches daily, spending just two minutes on each. Your goal is to pack maximum positive signal into that brief window.
Know your audience
- Investors are smart but overwhelmed
- They won't know your industry as deeply as you do
- They use you as a proxy for future business potential
Reality check: "The investor is not your user, so pitching users and pitching investors are completely different. The investor will almost always be less knowledgeable in every way about the problem, industry, solution, and jargon." — Michael Seibel, YC CEO
Sell yourself effectively
What works:
- Highlight impressive achievements, even non-business ones
- Mention previous growth/exit experience
- Describe the most impressive thing you've built
- Demonstrate technical ability with specific examples
Team dynamics matter: Explain how team members know each other (reducing breakup risk) and how skills complement each other
Be concrete and clear
The problem: Most pitches lack clear details about what's being built.
Weak example: "COMPANY will help ecommerce stores sell more products using cutting-edge AI-enabled algorithms and machine learning."
Strong example: "COMPANY built Google's typeahead search box as a Magento plug-in. It boosts search-to-purchase conversion and AOV."
Between the lines: Concrete details demonstrate expertise and make your pitch memorable. "If you do that, not only will I hear what you said, I will understand and remember it." — Michael Seibel
Target massive markets
The bottom line: Venture investors need companies that can reach hundreds of millions in revenue.
What investors seek:
- Market dominance, not just participation
- Fragmented markets that could be centralized
- Clear path to billion-dollar potential
By the numbers: Use Fermi estimates to demonstrate market size and quality of analysis
Share unique insights
What matters: Novel insights give investors reason to remember you.
Example that works: "Traditional learning management software is optimized around the needs of companies with long-tenured white-collar employees, like hospitals, or high-turnover blue-collar employees, like food service workers. Nobody has a good solution for startups undergoing hypergrowth..."
Go deeper: Acknowledge competitors and explain your unique approach
What's next
Successful pitches combine self-awareness, market understanding, and concrete details into a compelling narrative that makes investors want to learn more.
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