So you’ve made it past all the elevator pitches, general presentations, emails, and myriad phonecalls to the final chapter. Congratulations! You’ve come a long way. (There may be a few who jumped right to the final chapter but that’s rare.) Here’s a great tip from an actual venture capitalist on what to focus on when you make that presentation to the venture capitalist partners. (Taken from the Mashable article, Venture Capital: 5 Tips for Nailing the Full Partnership Pitch.
Dream the Vision, But Live the Numbers
CEOs and entrepreneurs are typically good at communicating their big-picture excitement for their company and its market opportunity. In fact, this ability to “sell” others on your big vision probably played a key role in your initial success with employees and investors.
During the partnership pitch, be sure to complement your qualitative vision with a firm grasp of your key numbers. As companies evolve and grow, investors expect them to become increasingly data-driven and grounded in quantitative facts. As my colleague Dan Nova is fond of saying, “You can fly an airplane at low altitudes by looking out the window, but when you’re above the clouds, you need control panels and instrumentation to avoid veering off course, or worse, crashing into a mountain.” Demonstrate your data-driven management by exhibiting fluency in the key numbers of your business. What constitutes “key numbers” will differ depending on the nature of your business, but it is safe to say that historical and forecasted financials, capital structure, important operational metrics, terms of key contracts, major expense categories, etc. are fair game.
If you don’t know the numbers well, you can have your CFO available to answer the more in-depth questions regarding your venture’s financials. However, as the CEO, the one leading the company, you MUST understand the basic financials and those that are critical to helping move your business forward. If you don’t, sit down with your CFO (or whomever is handling your finances and modeling, if you don’t have a CFO) and have him or her give you a primer course. Not only will this help you in your presentation, it will help you as you move your venture forward.