How to Start a Startup Lecture: Sales and Marketing, How to Pitch, and Investor Meeting

Presenter 1- Tyler Bosmeny

How to get from $0 to $1 million in sales

  • Reality is that you are the salesman when you are the founder.
    • “When you are a founder, you should be either building your product or selling”
    • founders have some advantages
      • passion
      • industry and product knowledge
    • Pick a founder to own this
    • Founder passion trumps sales experience
  • The Funnel – a couple strategies for each
    • Prospecting
      • Find the innovators (2.5% of potential market) – it is a numbers game. Which means you need to talk to a lot of people.
      • Reach out to >100 companies
      • Top 3 methods:
        • Your personal network
        • Conferences – go to where your users are
        • Cold emails
    • Conversations
      • When you get them on the phone, remember to shut up.
      • The best sales people will talk 30% of the time. Listen to their problems
        • What would your ideal solution look like?
        • How do you deal with this problem today?
      • Follow ups need to be really persistent. you need to follow up religiously
      • Your goal is to get people to a “yes” or a “no” as quickly as possible. Maybes will clog your process
    • Closing
      • Redlining – Final step to send them an agreement
        • YC has open sourced their template
      • Don’t waste time quibbling over small issues. If it is reasonable, sign the deal and move on.
      • “I will use your product, but it needs this one more feature” – 9/10 times if you build the feature, they will still not use it.
        • Either sign a conditional agreement, or
        • Wait to hear demand from more customers
      • Free trial trap
        • Early on you need commitment, validation, and revenue
          • a free trial gets you none of these things
        • A good way to handle it is have them sign a 1 year agreement, but give them the option to opt out within the first 30-60 days.
    • Revenue/promised land
      • 5 ways to build a big business: you need to have different strategies (see Christopher Janz article for the graph)
        • flea/mice/rabbits – marketing
        • Deer – inside sales
        • Elephants – field sales

Presenter 2 – Michael Seibel

Investor Pitch/Investor meeting

  • The best way to make your pitch better is by making your company better
  • Creating a pitch: Simply explain what you do, and ask for money
    • 30 second pitch – this is your general pitch you tell everyone. A good pitch is invaluable
      • What does your company do?
        • Mom test: if in one sentence, you cannot tell your mom what you do, you need to keep working on it.
      • How big is your market?
        • Figure out what general market you are in?
          • AirBnB could say how big the hotel market is
      • How much traction do you have?
        • “we launched in January, and are growing at 30% per month. Our current revenue is____ and ____ users”
        • If you do not have #’s like this, convey you are moving quickly “We incorporated in January, by march we launched a beta, by April we launched our product” – you are moving fast
    • 2 minute pitch – people who are more interested: investors, users, etc.
      • Clear 30 second pitch +
      • Unique insight – tell them something they don’t know, the aha moment, what the competitors don’t know. They need to aha, it has to be 2 sentences.
      • How you make money
        • one sentence, don’t run away from it. be specific- if it is advertising, say advertising. don’t just spout out any and every answer you can think of.
      • Team – if you and your team have some kind of great track record of making money, say it. How many founders, how many technical, how long have you known each other (should be >6 months), how you met. Keep this to 2 sentences.
      • The Big Ask ($$$)
        • You have to know what you are talking about – convertible note or safe, cap on safe, min investment size. If you don’t know this, the investor won’t take you seriously
  • When to fundraise
    • Investors like to invest in companies with traction
    • How do you flip the scenario – be in a scenario where you are strong and investors are weak. If investors are asking you if they can give you money, that is a good sign you have a strong position
      • Have you created a plan where you can launch and grow to profitability without the investor’s money. Don’t be dependent on the money.
      • Show the investor that you are committed and working fast
  • How to set up investor meetings
    • Warm intro from another entrepreneur or previous investor. Credibility of that person
    • Think parallel – fundraising should be a sprint where you schedule everything within a week.
      • “hey we are building like crazy right now and for the next two weeks, can we meet on the 3rd week?”

Presenters 3/4 , Qasar Younis, Dalton Caldwell

  • make sure the listener knows what you are talking about
  • know your numbers
  • know your market size- build bottom up analysis
  • you should understand something counter-intuitive
  • drive the conversation to a conclusion
  • your team should be uniquely suited for this business

Hallmarks of a good pitch

  • Capture interest, told and interesting story, engage the listener
  • Demonstrate insights and command of the market, passionate not didsmissive
  • collaborative meeting, more than an interrogation
  • Actually ask for money

After the meeting

  • Follow up (anything but a check is a “no”)
  • Work on creating deal heat (supply/demand)
  • Do due diligence on the investors
  • Know when to stop (addicted to fundraising)
  • Build your company – fundraising is not the goal

RG

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