A few months back, I reached out to an angel investor group here in the Bay Area, the North Bay Angels.
I’ve been sitting on their deal screening selection committee. Startups send pitches, business plans, updates, etc to us and we’ll review them and have the founders present and then select a few to pitch the whole group of investors. At the very least, it’s great experience and insight into what it’s like to see so many startup presentations, deal terms, valuations, and how investors like to filter and react to them. Here’s two of my biggest findings:
1. Don’t worry about your slide presentation
I noticed one thing immediately, founders feel the need to go through the entire slide deck, regardless of the time it would take or the pace of the presentation. I’ll give an example. The founder might be explaining the technology, financials, or the team (or something that may be boring to the investor) and the investor will cut him/her off with a question, “what about your growth rate?” at which point, the interrupted founder will say, “um… well actually, I’ll get to that in a few slides…”. The investor goes back to flipping through the papers left in front of him or checks his email. I understand that maybe the appropriate thing to do as the investor is to be patient, however there’s no perfect world here in startup-land, and the ones with the gold make the rules. In fact Fred Wilson recently noted that if you get through one slide and the rest of the time is spent in a discussion, you’ve done something right. I wholeheartedly agree. The most engaging part of the pitches were the most productive.
2. Know your audience
One of the entrepreneurs, in an attempt to note the length of experience in their team, made a small dig at younger founders. I was the youngest in the room, but still, if I had any more influence, I’d be worried about making those kind of remarks.
A better example of ‘knowing your audience’ was that one of the products being pitched rang very true to two of the investors and both immediately became strong supporters in getting them to the next level.
I’m already looking forward to the next meetings and I’ll try my best to share anything blogworthy!