21. March 2018
Interview: What works and what doesn’t when pitching to investors
He hears countless elevator pitches and decides whether a startup gets an investment. The UP21 Co-Founder and CEO Vítek Šubert sees dozens of presentations every year and gives presentations himself in crowded halls. If you want to know how to pitch better, read an investor's insight to learn what you should focus on.
What makes you say to yourself, No, I will not listen to this person?
A person who comes late to a presentation loses 50 points out of 100. When this happens, it’s extremely hard for me to listen to the presenter. If an entrepreneur feels that getting an investment is a life opportunity, they should rather come half an hour earlier than five minutes late. It is a part of business culture. If someone is not disciplined, they will never be able to build a company from scratch and drive the team, because discipline is transferred from founders to the team. Coming on time and complying with deadlines is a key element that I observe when I formulate my opinion of people.
What else do you focus on beyond punctuality and reliability?
I am really interested in the energy that emanates from the person and in my gut feeling which tells me whether I can trust the person in their project. I make a final decision based on whether I can imagine sitting with the person every day and talking for an hour about their product. So far, I have felt this with all our startups, but it is something that is hard to describe.
What's the most important thing in a presentation?
The ability to present an idea in a clear and timely manner. If someone cannot get a simplified story of their project on seven slides, their project is not thought-out. Any entrepreneur should be able to convince me during a short ride in an elevator. If he fails to do so in 15 minutes, he has a fatal problem. An investor is a simple person who wants to see a simple idea and a team that delivers the product to the market, making the best use of the invested money.
What should the presentation look like visually?
For me, less is more. If there are only white slides and black text, I am fine with it. Simplicity is clearer. As far as presentation is concerned, one should behave in accordance with the fact that he is asking for an investment worth millions. The manner of speech should have a certain level. I'm not saying that you have to speak like a dictionary, but if you use non-standard and vulgar expressions, I will certainly not want to cooperate with you.
Do you observe what the person is wearing? Does the outfit influence you?
I am not expecting people to wear a tie, as I do not wear one either. An entrepreneur can easily wear jeans and a white shirt and it's great, but the presentation as a whole must make sense. If someone wears ripped jeans and I can see their hairy legs, something I have already experienced, I might be hesitant and think to myself, "I don’t know if this is the right dress code when going to an investor." I don’t mind programmers wearing sweatpants; it is just that it is a bit different to go ask for money in it.
What about the presentation skills? Are they a decisive factor for you?
It's nice if someone has great presentation skills, but I do not expect it a priori because it's a matter of practice. Usually young people come here to give an elevator pitch and they do not have much experience. Certainly they should have some if they want millions, but I'm willing to tolerate mistakes. They have a year and a half to hone these skills before they can apply for A series investment that can be up to 3 million euros. After all, the role of our incubator is to teach them these skills.
Do you mind when people are nervous while presenting?
To some extent, it's cute to see someone being nervous because it's an important moment in their life. It feels natural, but people should definitely not be so nervous that they cannot speak a word. Entrepreneurs must be a bit like bulldozers in believing that their product can change the market.
I wonder if there are any cultural differences in presentation styles?
Yes, sure. Dynamics are different here and in Silicon Valley. A year ago, when I was preparing André Dravecký, the CEO of Shipvio, for the Startup World Cup finals in San Francisco, we had to change the whole presentation. The slides remained the same, but we completely changed the story.
What's the main difference between European and American presentation styles?
In the US, a presentation is essentially a show; everything is much more exaggerated. If someone would make such a presentation here, people would say that it's too much, but it's part of the game in the US. They always want to hear that your product will change the world. If someone does not say it, they will ask you how your product will change the world anyway. I am not such a big fan of this sentence; it seems to me that it is more fit for the Miss World Contest, but in the US, it must always be mentioned.
You’ve got experience with Silicon Valley. Can you tell me something interesting that you learned there?
In the US, they say half of the European startups tell overly complicated stories. Americans are used to doing things in a simpler way. It is one of the fallacies about Silicon Valley that it is always necessary to define a problem and show its solution. I talked to Guy Kawasaki, who worked for Apple in its very beginning stages, and he told me that if anyone can explain their product well, he can draw a problem himself. Investors in Silicon Valley are always laughing when a new book comes out and contains these myths.
Okay, so there is no universal recipe, but how can you make a great presentation? How can I learn to do it?
You should learn by doing. I am an opponent of presentation skills trainings because I think they simply repeat the same thing all the time. Giving lectures to high school students five times a year is much better than learning skills in a classroom with five other people in front of a mirror. I have learned to present by doing one presentation after another, asking people for feedback and constantly trying to improve myself. But as I have already mentioned, we do not expect entrepreneurs to give outstanding pitches. Their job is to explain to us, clearly, what they are doing. If they get an investment from us, we will help them hone their presentation skills.