What Drives Investors Crazy in Pitches, Part 2 (Expanded Survey Insights) — Cleve Langton
In early August, I sent out a survey to qualified investors I know asking them what are the pitch killers that make them tune out and mentally run for the hills. They are all active early stage investors. I followed up last week based on the Wave #1 responses. Here’s additional feedback. Very strong consistency of opinion.
· Slow take off sets a negative tone that is very hard to recover from. Almost total unanimity of investors on that.
· A strong prior exit track record overcomes a lot of presentation sins, but it’s not a pass through to the next round
· Bad presention skills undermine confidence in all that follows. Even “inconsequential” things like slide share screw ups result in consequential dings.
· Jargon and arrogance go hand in hand and are major pitch killers. Many investors described both as being “tone deaf.”
· Market size and category trends assertions without strong third-party validation relegates them to “observations”, not data.
· Geographical bias. Investors prefer being geographically close to companies in which they are investing. East Coast vs. West Coast can be seen as an ocean apart, not just a flight apart.
· BOTTOM LINE: No investor admits it, unless probed in depth, that right-brain considerations are as important as the left-brain numbers. Strong growth potential, strong category growth and competitive insultation are seen as table stakes, but investors say the real go/no-go decision is “Do I want to spend time with the CEO and the team? Is she /he open to input? What happens when things get tough — can they navigate curve balls and burnout? Are they in it for the long run?”
These are the points that had the greatest unanimity among investors in both the initial feedback and the follow up. Happy to share the full list if you ping me.
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