Best Startup Pitching Exercises from Seasoned Founders and VCs (that helped entrepreneurs raise millions in venture capital quickly)

 By Martin Luenendonk| 2017-07-24T22:37:39+00:00 June 19th, 2017|

“Practice makes perfect”

It’s quite an annoying saying when you don’t have the luxury of trying hundreds of times – like when you’re pitching your startup and everything hangs in the balance.

Nonetheless, it’s true.

Experience helps. If you can test things and try them out, you can gain confidence and ensure your investment pitch is smooth while increasing your chances to raise money from investors.

Now, in the previous sections, I’ve helped you give a killer elevator speech and structure a winning pitch deck. I’ve even given you a hand in hacking your way through the presentation.

But you might still want some more practice – some exercise with ensuring everything I’ve talked about in the previous sections comes together during your investment pitch.

Well, luckily, you don’t need to do it all on your own.

Hundreds of entrepreneurs have done it all before you.

Heck, even the seasoned VCs have thought about the struggles of pitching and devised strategies that can help raise more money.

So, in this guide, I’ll explore the best pitching exercises that will help while you prepare to pitch your startup to investors.

I’ve picked exercises based on the four components of a winning pitch. I’ll provide exercises that’ll help you with storytelling, keeping your investment pitch short and simple, tailoring the pitch for the audience, and ensuring you evoke emotions.

I’ve even decided to throw in a surprise tip in the end.

Let’s recap: the keys to successful pitching

The best pitching exercises are those that help you focus on what makes a successful pitch.

The four pillars of a successful pitch were:

A successful pitch

So, when it comes to exercising pitching and ensuring you actually attract more money with your pitch, you want to focus on strengthening these four keys.

So, let’s turn our attention to pitching exercises that help you nail the four pillars and raise millions.

The best storytelling exercises that turn you into Shakespeare of your startup pitch

Storytelling makes pitching a lot more compelling. It turns your boring list of functions and figures into a riveting journey from a humble idea to a multi-billion dollar business.

So, how to exercise storytelling?

There are four easy ways to add more storytelling to your pitch.

Tell the origin story

Now, I mentioned the two powerful storytelling options in my guide to structuring the pitch deck.

Soren Petersen and Steven Bussard suggested the origin story and the vision story as fantastic structures for a cohesive narrative.

Both also offer great exercise opportunities for pitching.

Let’s look at the origin story first.

The origin story works because we love the rags to riches stories. It’s inspiring to hear how people came faced with adversity and survived or how a modest idea suddenly took over the whole world.

The whole human experience is built on origin stories – ancestors tried to explain how they got here and modern nations are essentially just born out of a way to explain the roots of its existence.

Even if you don’t pitch with the origin story, thinking about it can help you identify interesting points about your startup.

A good exercise for creating a storyline that follows the origin story model is to answer these questions:

  • What problem have you noticed in the world? How and when did you realise it?
  • What challenges did you face when you start solving the problem/coming up with ideas?
  • How did you meet your startup team? What role did they play in your understanding of the issue?
  • How did you finally start overcoming and solving the challenges you faced?
  • What was your final solution to the problems and how has the solution worked?

Outline your vision

The other good option for storytelling is to focus on the vision story.

Why did you start your business and where do you want the startup to be in 10 years down the line?

When it comes to visionary pitching, you want to watch something like J.F. Kennedy making a pitch for the US to go to the moon. Of course, it also doesn’t get much more visionary than Martin Luther King giving his “I have a dream” speech.

You can practice the vision story more by answering these questions:

  • What will the world look like when your product is on the market?
  • How will your product solve the problem?
  • Why does the problem really matter?
  • What would the startup’s obituary read like?

Have your hero but also your villain

What do all the great stories have in common?

What connects the Harry Potter books with the Gladiator movie?

Heroes and villains.

Every story needs a hero – the person(s) who saves the day and makes everything just a bit better.

But you can’t save the day if there’s no villain – someone or something that is ruining it for everyone else.

And so, your startup pitch should add to storytelling by creating these heroes and villains.

It shouldn’t take much exercise to think who the hero in your pitch is. It obviously should be you, your startup and the team.

But you should take a moment to think about the ‘villain’ of the story.

Now, the obvious way to think about it is to think of the problem as the villain.

But you want to dig a little deeper and truly understand what makes the problem so consequential and bad. Why is the problem a villain and not just an inconvenience, for instance?

Note that your real villain might not just be the problem you are solving.

It could be something related to it.

Consider, for example, that you know businesses are doing less importing in your industry, Now the problem is not that it’s that hard, but because it’s complicated and this is down to red tape (the real villain).

And you are heroically fighting against this with your new app that you can use to find the right documents and fill them online with the help of professionals.

Pitch Deck Course

3-act exercise

You can also exercise pitching by going to the basics of storytelling: the structure of a good story.

Every good story has three core elements:

  • A start – opportunity to introduce the situation.
  • A middle – opportunity to build excitement, add emotion to the story.
  • A finish – opportunity to solve the problems and to provide a conclusion.

To practice how this could work with your startup’s investment pitch, do the following:

Create a story-like pitch with three acts:

Three acts of a startup pitch

To ensure you don’t just blabber on, try to make each act just 30 words long.

So, when you meet the hero, spend 30 words describing who he is and what does he do.

For instance:

“Mark is a graphic designer, who worked in Microsoft and Google, helping them to create beautiful and inspiring websites.”

Guaranteeing your pitch is short and simple

Since the average investor only spends just under 4-minutes starting at the pitch decks and the fact our human attention span is incredibly short, your pitch must be short and simple.

Here are three super simple exercises that can help you identify the essence of your startup and make sure your pitch doesn’t require a rocket scientist to understand it.

120-second explanation

“If you can’t explain it simply, you don’t understand it well enough.” – Albert Einstein

The above quote is the perfect guideline for your startup’s investment pitch.

But no! My technology and product need more time to come through that a single minute,” you might be shouting at the screen.

Well, no.

It really shouldn’t take you 10 minutes to let an investor know you add value to their investment portfolio.

Heck, we humans don’t have a long attention span – if you haven’t convinced them in the first two minutes you probably won’t even if you talked for an hour.

That’s exactly what Andrea Barrica, 500 Startups venture partner and entrepreneur-in-residence, tells when she coaches startups to pitch.

Her successful exercise method is simple:

You have 120-seconds to make the investment case.

What this limited amount of time does is it forces you to:

  • Know the essence of your startup pitch and the single reason that convinces investors to invest.
  • Choose what really is important and what is not. You need to look at all the data you have and pick the biggest selling point in terms of investor interest.
  • Objectively view your startup and the market it’s operating in. You must find the evidence that investors really want to hear: why your business will grow fast and wide (and provide them +10x returns).

Explain it like I’m 5

Investors want to immediately understand what your startup is about.

As I’ve told in the previous sections, you can’t use complicated language and jargon – getting to the point and using language anyone can understand will have much bigger impact.

New concepts and ideas, like your startup, might not open up immediately to a room full of people who hear it the first time. You’ve probably been working on the concept for months but the investor hears about it the first time.

And so, you need to use the ‘Explain Like I’m 5’ tactic.

Now, if you’ve never heard of the concept, you must venture in the sub-reddit for ELI5. It’s a great place to learn about anything without having to read a scientific research paper on it.

The idea of the concept is this: You try to explain a complicated wisdom in a manner that a five-year-old with no scientific knowledge (in the deeper sense of the word) would understand.

So, what do you want to do in the exercise?

Create a pitch that would tell a non-professional what your startup is, what its objective is and why it’s a great thing for the world and for investors.

A good way to test this is by pitching to your children, friends’ kids or flip it the other way and pitch to your grandma (assuming she’s not a retired entrepreneur or investor!).

When you are doing this, you will have to:

  • Simplify your business idea and the product or service.
  • Explain and use language that’s commonplace and approachable.
  • Notice what are the toughest concepts to translate into simplistic language and how you can potentially change this.

One word of warning here, though.

Explain It Like I’m 5 should never be taken as the chance to be patronising. You don’t want to talk to the child (nor the investor) like they are stupid.

Don’t make it easy to grasp because you know the other person is dumb but because you appreciate people are different in what they know or how they learn things.

The one-word pitch

Now, you can take the short and simple even further and practice pitching with just one word.

Yes, you read that right.

It really doesn’t have to take more than a word to get to the bottom of your business and your vision.

The idea comes from Daniel H. Pink. The bestselling author believes you can best define your brand by focusing on finding that single word to speak the essence of your startup.

Pink told Carmine Gallo by reducing your startup to a single word you need to have “discipline” and “clarity”.

You really need to get to the core of what your startup is about and what does it want to achieve.

You can get the idea if you think about some of the most famous companies and the words you automatically associate with them.

Gallo points to the following examples: ‘search’ will most likely make you think about Google and when you hear the word ‘priceless’, you probably imagine MasterCard.

So, your job is to boil your pitch down to the word that defines your business.

Now, what would it be for your startup?

Your not talking to a generic VC, you’re talking to a person with a name, preferences and specific reasons to be in this business

Of course, you also need to ensure your pitch is aimed at the right audience.

For this, you must be willing to put yourself in the investor’s shoes and look what your pitch and startup look from the outside.

Play mock-up

Remember how as a kid you pretended to be a police or a fireman?

Playing mock-up is actually a useful tool even for us adults because it makes us step outside our comfort zone and think what other people are thinking.

If you want to understand what an investor truly thinks about your pitch, you kind of have to become the investor.

It’s not good enough to practice the pitch over and over as the person who’s going to give it.

It can be helpful to step on the other side and imagine what the pitch looks like in the eyes of the investor.

Now, a New York class of Startup Leadership Program does just this with actual startups. They make startup founders pretend to be fake VCs, fill fake term sheets and then present these to other investors.

This kind of mock-up helps because it will force you:

  • Think what the investors want from their investments.
  • Realise how investors valuate a business and its ability to make a return.
  • Listen to the pitch as an outsider and carefully consider whether it’s appealing, let alone investment ready.

Indeed, Kanchan Koya, the director of Startup Leadership Program, told Betabeat the essence of this kind of exercise. “The mission was to get an insider glimpse into the mind of an investor but also to give start-ups an inside view into why VC funds make the decisions they make,” she said.

Find three reasons why the investor shouldn’t invest

You can also practice targeting your pitch to the audience by thinking why the particular investor might not invest in your business.

It’s rather easy to look at your startup and find those positives; those metrics or ideas that will make investors interested.

But it can actually teach you more about the investor you are pitching to as well as your business in general if you think about it the other way around.

Why shouldn’t the investor invest?

Again, pitching guru Andrea Barrica uses this sort of exercise when she is training startups. She makes them come up with three reasons the investor shouldn’t invest.

More importantly, she doesn’t want the startups to pick a generic reason.

Oh, it’s because our team is inexperienced.”

I think they just didn’t like the product.”

Focus on the nitty gritty – what is the specific reason for them to say ‘no’?

Perhaps it’s because you didn’t manage to focus on the team’s strength of your plan to improve it further with the investment.

The rejection might have been a specific metric – maybe your churn rate is too high or they are worried about a recent slow-down in growth.

It could be the market – perhaps the market segment is not currently hot or the market is shrinking.

Maybe you simply didn’t present a proper plan for the future – the investor might not quite realise what you are looking to achieve five, ten years down the line.

Now, thinking these can be especially powerful in improving your pitch’s ability to speak to the particular investor.

For example, think about the market. If the investor has no previous experience in the industry, how are you going to convince them they should now?

If the investor has past record in selling their companies, will you be able to convince them of your plans for imminent IPO?

You’ll be able to step deeper into the investor’s mindset and focus on those aspects of your pitch the investor would care the most.

And you’ll be able to notice the pain points and remove them from your pitch.

Causing an emotional reaction and sticking in the VCs mind

Good stories stick to your mind. The reason they do it is that they caused an all-important emotional reaction.

And founders and VCs have a few exercises that can help you add this crucial element to your pitch.

Acknowledge the dark side

There’s one more secret to storytelling you must know: emotions.

Good stories always create an emotional reaction: they make as laugh, cry, feel angry, or just incite happiness.

As research has shown, we don’t make decisions based on cold-hard logic – even when we think we do – but rather the emotional response we had.

Bronwyn Fryer interviewed the wonderful script writing coach Robert McKee, with McKee revealing some powerful lessons about storytelling.

Perhaps the most compelling argument is to acknowledge the dark side of things in order to make things interesting.

The idea is that a story startup story where everything goes according to plan won’t appeal as much as a muddy one.

Startup life is not easy and it hardly ever goes exactly as planned.

Therefore, investors might get suspicious if all you give them is rosy figures and promises.

Telling the ugly truth can sometimes be much more powerful because it is realistic – life is not always sunshine and rainbows.

McKee told in the interview:

“You can send out a press release talking about increased sales and a bright future, but your audience knows it’s never that easy. They know you’re not spotless; they know your competitor doesn’t wear a black hat. They know you’ve slanted your statement to make your company look good. Positive, hypothetical pictures and boilerplate press releases actually work against you because they foment distrust among the people you’re trying to convince.”

What you need to do is think about the shadows for a bit. You want to look at your story and your startup pitch and answer these questions:

  • What is wrong? Essentially, the problem you’ve discovered in all of its nastiness.
  • What is needed to restore the balance? This is the solution or the solutions that could turn things around and remove the problem from the world.
  • What is stopping people from doing this? An honest account into why people are not solving it. A look at the things that continue to ‘maintain’ the problem.
  • How would this be solved? Figuring out how to actually move past the problem and finally get rid of this issue (most likely your startup!).
Investor readiness checklist

Find the way to engage

I, unfortunately, have to repeat myself once again:

Practice makes perfect.

Authors don’t tend to write their award-winning books in one go – it takes countless drafts to get everything just right.

Therefore, you do need to practice pitching in order to notice what are the strong moments and what are the weak sections – especially in terms of engagement.

You should give the pitch to friends, family, investors and other and get honest feedback.

What points made them laugh? When did they pay the most attention? What was boring?

With the insight, you can actually focus on the presentation.

Even if you don’t change the slides or much of the wording, the feedback will help you notice when the investors are more alert. And you can get the boring stuff done quicker.

Now, there is another way to engage with the investor.

In order to practice it, you need to learn to find a moment from your pitch that allows you to directly speak to the investor.

Perhaps you can make the problem feel personal to them. Maybe you can mention their previous winning investment and how you’ve beaten that startup’s traction figures so far.

The other exercise tips deal with getting the investor directly involved.

  • Could you add a prop to your pitch?
  • Do you have a prototype of your product, which the investor could play with, while you talk about it?
  • Can you demonstrate the problem with props?

Now, you don’t want to flood your pitch with props and you should use them unexpectedly.

Instead of having the prop there in view the whole time, pull it out at a certain point to create anticipation and excitement.

Manners of Speaking has great tips regarding prop use and it’s definitely worth reading if you like this option.

Turn your pitch into a question

Daniel H. Pink had another clever exercise trick to help you refine your pitch.

It’s especially powerful in terms of engagement and emotional reaction.

The idea is that instead of explaining, you should turn the whole pitch into a question.

The question pitch is actually based on research. Ohio State University’s researchers have found that if the facts are on your side (i.e. the startup is essentially investment ready), you’ll be more effective in pitching with questions rather than just stating the obvious.

The tactic is actually often used by politicians when they want the voters on their side.

Back in the 1980s, the US economy wasn’t doing well and during the presidential election, Ronald Reagan went around asking voters, “Are you better off now than you were four years ago?

Now, if he had just gone to say, “You are worse off now than four years ago, vote me” he wouldn’t have been as effective.

Why?

Because the question makes you notice of what is being said and actually think about the situation.

When you are forced to think about the facts, you’ll connect with them more. You’re not just passively taking in information but thinking what your objective view in on the topic.

Therefore, you should practice your pitch by adding a few more questions to it.

Look at the different elements of your pitch – especially the strongest arguments you can make. How can you turn them into a question?

A final tip from founders and VCs: You need to keep your cool!

Now, pitching is a lot about the visual presentation as well. Your presence and ability to engage with the investors will play a crucial role in determining whether you get an investment or not.

Remember, investors don’t just invest in great ideas they actually invest in people.

VCs tell each other all sorts of unflattering stories about the pitches they’ve had to endure over the years. Some have been sweating on the table and some have even burst into tears in the middle of a pitch.

Yes, that rather leaves an unprofessional mark in the investor’s mind.

Investors pay attention to the people – you pitchers – because you are essentially the whole startup.

Sure ideas and products matter.

But you make the daily decisions to keep the business going. It’s these decisions that in turn determine whether you make a million or not.

Therefore, the final exercise investors would want you to focus on is staying cool.

The pitching process can be daunting but you don’t want it to show – you need to look confident and perform in a friendly, likeable manner.

So, how do you calm the nerves?

Bright Spot Fundraising recommends three exercises that can help with your presence:

Improved presence during a pitch

As you can see, there are many tricks and tips that can help you create a better pitch.

Practice does make perfect and you can learn a lot from seasoned founders and VCs.

Therefore, never turn down an opportunity to learn more.

So, which startup pitching exercise are you going to try?

Do you think exercises are good at giving you more insight into your pitch or can they work against you?

And before you nail your pitch, I have one more advice for you:

Don’t say stupid stuff.

Want to find out what I mean? Check the next section.

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