"In graduate school, you learn all this complicated stuff, but what's really essential is being able to get others to follow your ideas." — Warren Buffett
Warren Buffett is probably the most successful businessman in the world. He started investing his newspaper delivery money at age fourteen, soon was investing other people's money, and today he manages over $950 billion worth of assets via his holding company, Berkshire Hathaway.
If you walk into Warren Buffett's office in Omaha today, you might expect to see his framed diploma from Columbia Business School on the wall. But you won't. Instead, you'll see a faded 1952 certificate for completing a $100 Dale Carnegie course on public speaking proudly displayed.
Buffett believes that learning how to be good at speaking and presenting changed his life, perhaps even more than his MBA. And so it is for entrepreneurs everywhere. To be a successful startup founder, you must have the ability to tell a crisp, clear, and compelling story about what your startup does and why it matters.
Many people think of this as a skill required mainly for fundraising, but successful entrepreneurs are pitching all the time for all sorts of reasons: pitching for customers, recruiting employees, getting partners, rallying the team, and so much more. As Buffett tells us, entrepreneurial success requires being good at preparing and delivering great presentations.
Pitching is really all about storytelling skills.
If you want to be an effective speaker, you need to learn how to be a good storyteller. All great startup founders are great storytellers. In fact, all great leaders are great storytellers.
Humans are hardwired to love stories; we told them around campfires for several thousand years before PowerPoint was invented. An excellent presentation doesn't need slides at all. Here are a few storytelling tips and tricks.
Simple stories are the best stories.
The key factor of storytelling is keeping your stories simple, which is much more difficult than many people realize. Avoid jargon, and keep your narrative easy to understand. As Paul Graham advises: "When you describe what your startup does, describe it in the most matter-of-fact way possible. Professional investors hate having to decode marketing speak. Describing your startup in grandiose terms is the mark of a noob."
Uber's original pitch deck described the startup as "a fast and efficient on-demand car service" — nice, simple, and clear. The original Airbnb pitch deck title slide says, "Book rooms with locals, rather than hotels." Neither company reached for buzzwords, and both got funded.
I once met an entrepreneur at a social event and asked him what he was working on.
"Well," he said, "there are a lot of grocery stores in the country." A pause. "Their biggest facilities expense is cold storage." Another pause. "We make a device that cuts that cost in half."
Boom. In three short sentences, he alluded to the size of the market, articulated the problem to be solved, and suggested he had a product with a compelling ROI. I wanted to invest.
An inexperienced entrepreneur might have described the exact same startup as: "We've developed a cloud-powered IoT device that uses proprietary algorithms to analyze operational data for mercantile customers, generating paradigm-changing results." I would have walked away.
Take Paul Graham's advice. Describe your startup in simple, matter-of-fact terms — because why would you want to make it complicated?
First-person stories are the best stories.
Telling your stories from your own personal perspective always makes them more interesting. How did you come up with this startup idea? Why is it meaningful to you? What gets you up in the morning? And most importantly — why are you exactly the right entrepreneur for this venture?
Practice, but don't memorize.
You want to sound like a human delivering a great story, not a robot reading a script. There's a subtle but crucial difference. Don't memorize your pitch word-for-word. Instead, memorize your key talking points, then practice repeating them until they sound natural, like something a person might say in casual conversation. Practice by telling the story to your mom, your husband, your daughter, your neighbor. What's the problem you're trying to solve? Why does it matter? How did you get involved? Keep it real.
Know your audience.
I was once in a pitch meeting with another investor, a woman with a PhD in artificial intelligence. As the young entrepreneur was getting ready to pitch, he turned to her and said, "I don't know how much you know about AI technology, so I'll try to keep this simple." I cringed. Needless to say, he didn't get the investment. Before you walk into any pitch meeting, look everyone up on LinkedIn. Your presentation will be much more targeted, and you'll avoid some cringe-worthy moments.
Be clear on your desired outcome.
I once worked with a guy who was the most disciplined salesperson I've ever known. Every time we were about to walk into a customer meeting, he would turn to me and say, "What do we want the outcome of this meeting to be?" So it is with pitches and presentations — be clear on your desired outcome as you prepare. Maybe it's to get invited back to meet with other partners, or maybe it's a referral, or maybe you're deep in the process and your desired outcome is a signed deal that day.
On a related note, research shows that people are only going to remember one or two points of your presentation, so decide in advance what you want those points to be, then highlight them several times.
What, What, and How?
Whenever you're telling an audience about your startup, there are three simple things they need to understand: What is it, what problem does it solve, and how does it make money? I can't tell you how many pitches I've sat through without actually knowing what it was at the end. Make your first sentence simple and clear, like:
Then you can launch into the details, the ingredients, the distribution strategy, the carbon footprint, and everything else. All that will be much more meaningful for your audience if they first simply understand what this is, what problem it solves, and how it makes money.
No live product demos — ever.
I once sat in on a pitch where a young entrepreneur was having his first VC meeting. He was building a software platform for consumer health. After brief introductions, the VC said, "I think this is an exciting space, and I'd love to hear your thoughts on the best monetization route for a product like this." As if he didn't even hear the question, the entrepreneur launched into a thirty-minute product demo — a really boring one that never actually answered the question asked. It was a live demo, so there were a few bugs and glitches. I knew after about five minutes that this pitch was lost.
An investor isn't worried about whether the product could be built; he's worried about the monetization model, the go-to-market strategy, the unit economics, the depth of the team, the competitive landscape. A glitchy product demo doesn't address any of those.
Successful entrepreneurs are great listeners. Mediocre ones just want to show off what they've built.
Benefits > Features.
When Apple launched the original iPod, there were many other portable music players on the market. The competitors' ads boasted long lists of features: specs about MP3s, megabytes of storage, kilohertz of audio playback. In contrast, the iPod ads simply showed a photo of the product with the headline: "A thousand songs in your pocket."
Engineers develop features, but customers buy benefits. What an investor cares about is whether your startup will provide benefits that customers will pay for. Keep your pitch focused on benefits for customers.
Look good on Zoom.
As an entrepreneur today, many of your initial presentations will be conducted via video. Make sure you look and sound good. If people are struggling to hear you through choppy audio, that's all they'll remember. If your backlighting is bad, what they'll remember is how your silhouette made you look like you're in the witness protection program. Get a real microphone, get good lighting, unclutter your background, and make sure your slides are all set up and you know how to share them. Practice your pro-level Zooming with your cousin in Cedar Rapids. Our expectations for professionalism via video are high now.
Finally, some words from Einstein.
I started this chapter with Warren Buffett, and I'll finish it with Albert Einstein. He said, "If you can't explain it simply, you don't yet fully understand it." So one of the many reasons why you want to get good at telling your startup story simply is that in the process you will get better clarity yourself on the essence of the startup you are building. The process of figuring out how to say something simply has helped me find better clarity on the essence of what I'm working on.
Great thinkers — and great entrepreneurs — are able to present their ideas in a crisp, clear, and compelling way. Keep practicing, and you'll become one of them.