elevator pitch, o´leary

1 © Copyright 2004 Chris O’LearyElevator Pitch 101

Elevator Pitch 101Chris O’Leary

Version 1.21


What’s AnElevator Pitch?


ELEVATOR PITCH DEFINITION

An Elevator Pitch is ashort, tailored, and benefit-focused

description of anew product or service.


THE ORIGIN OF THE TERM

• Silicon Valley• Run into a Venture Capitalist in an elevator

– They ask you what you do

• You have the length of the elevator ride(15 to 60 seconds) to convince them to…– Continue talking– Set up a follow-up meeting


THE GOAL OF AN ELEVATOR PITCH

• Prove to a potential investor that…– You are articulate– You understand selling– You can get a customer’s attention

• Not to…– Convince them to invest in your company– Persuade them to buy your product or service– Close the deal


ELEVATOR PITCH = TEACHING TOOL

• The listener probably doesn’t…– Know as much about the subject as you do.– Care as much about the subject as you do.

• Don’t just load people down with facts– First establish the context of your innovation– Help them organize what you’re going to tell them

• Tell them what you’re going to tell them…• Listener = Your Grandmother• Listener = Your Sales Force


WHO NEEDS AN ELEVATOR PITCH?

• Entrepreneurs• Intrapraneurs

– People inside a large organization who are…• Trying to sell a project

• Trying to get funding for a new product or service

• Salespeople• Consultants• Job Seekers


WHEN TO USE AN ELEVATOR PITCH?

• Elevator• Social Setting…

– Introduced to someone by a friend– Introductions before a meeting

• Buffet Line• Line at the Bar

• “And what do you do?”– You only have one sentence to respond


Characteristicsof a Good

Elevator Pitch


I have only made this letter rather longbecause I have not had timeto make it shorter.

– Blaise Pascal


SHORT

• People are busy– Too many things to do– Too little time to get them done

• People aren’t…– As interested in the subject as you are – As knowledgeable about the subject as you are

• 30,000 foot overview


TAILORED…TO THE AUDIENCE

• Different people care about different things• Speak to the concerns of your audience

– Engineers• How does it work?

– Investors & Partners• What is it?

• Who will buy it?

• How big is the market?

• Can you make money selling it? How much?

• Who is on your team?

• How much experience do you have solving the problem?


TAILORED…TO THE TIMEFRAME

• Pay attention to how much time you have.– Too many people assume they have 10 to 15 minutes.– Realistically, you only have 10 to 15 seconds.

• Get your key points across.• If you have time, expand on your message.• Elevator Pitch = Accordion

– Concertina


ELEVATOR PITCH = CONCERTINA


BENEFIT-FOCUSED

• So what?– Why will people buy what you are selling?– What’s wrong with the state of the art?

• Not just a Solution In Search Of A Problem


The Flow of anElevator Pitch


COMMUNICATION 101

• What…it is and does• Who…will buy it• Why…they will buy it• Who…you are to solve the problem• How…your innovation works


People used to tell me that if you can't explain your idea in the span of an elevator ride,then it's not a good idea.

My answer?

If I have an idea that I could explain completely in an elevator, it ain't much of an idea.

– Dean Kamen


THE FLOW OF AN ELEVATOR PITCH

• Summary Sentence• The Customer• The Problem• The Pain• The Solution• The Benefits• The Team• The Money• The Deal

• Don’t talk about The Technology


SUMMARY SENTENCE

• The single most critical element• What to say if (since) you only have 10 seconds• Quick overview of what you do…

– Set the context– Position your product and company– Can be used on its own to introduce yourself– Tagline


SUMMARY SENTENCE TEMPLATE

Company Name is a Type of Companyand has developed a Product Category

called Product Name that isKey Benefit(s) than existing solutions.


THE CUSTOMER

• Who will buy what you have built?• Do you understand the customer?

– Motivations– Existing solutions

• Talk about specific people and/or companies– Not market segments


THE PROBLEM

• What’s wrong with the state of the art?– What will drive people to adopt your innovation?

• How many people (or companies) are experiencing The Problem?

• Ways to communicate The Problem…– Start off with a (preferably personal) story– Explain how you came to see that a problem exists– Compare and contrast the state of the art and your

vision of the future


THE PAIN

• What are the consequences of The Problem?– Money– Time– Physical or psychological pain

• Be specific and tangible about the nature and magnitude of the cost

• Give evidence that people are in pain– That they will change and adopt your innovation


THE SOLUTION

• What have you built?– Whatzit?– No “How”

• Give people a plain English definition– No jargon– No acronyms– No MBA speak

• Use analogies– What’s it like?– How is it different?– Hollywood pitch meeting


THE BENEFITS

• What’s in it for me?• What is your relative advantage?

– Compared to the state of the art (e.g. existing solutions)

– Ideally, you can offer a 10X improvement– Problematic if only 1X improvement

• How will you get the attention of your customers?• Do you…

– Help people make or save money?– Save people time?


THE TEAM

• High level– Cumulative years of relevant experience

• Why are you qualified to solve The Problem?– Emphasize the credibility and credentials of the team– Patents

• What is your prior experience…– Dealing with The Problem?– Solving The Problem?


THE MONEY

• What do you need to reach the next milestone?– Prototype?– Shipping product?

• How much $ you need?• How much time will it take?• High level use of proceeds

– Where are you in the product development lifecycle?


THE DEAL

• Leave it until later• Don’t mention valuation


DON’T TALK ABOUT THE TECHNOLOGY

• Paradoxical• Hard for many people

– What they love– What they have spent _ years dealing with

• The logic– If they understand it, you won’t give them enough– If they don’t understand it, they’ll lose interest

• Litmus test– Can you sell?– Can you talk to an Ordinary Person?


IF YOU ARE PRESSED FOR TIME

• Cut anything…– That may appeal to (or be understood) by just a few

people– That may involve a negotiation– That may require an in-depth conversation

• Cut from the bottom of the list…– First cut The Technology– Then cut The Money– Then cut The Team

• Everything else should be touched on in your Summary Sentence


Exercise

What’s Wrong WithThe State of The Art?

SalesLogix = Synchronization, UsabilityHeuris = Cost, Quality


SampleElevator

Pitch


ABOUT SALESLOGIX

• Leading middle market Customer Relationship Management (CRM) brand

• Founded by Pat Sullivan– Creator of Act!

• Raised $17 million in 3 rounds• Sold to Sage Software in 2001 for $253 million


SALESLOGIX - SUMMARY SENTENCE

SalesLogix is a software company and has developeda Customer Relationship Management (CRM) system

that is both more powerful, and easier to use,than existing CRM solutions.


SALESLOGIX - THE CUSTOMER

Our customers arethe tens of thousands of mid-sized organizations

that have outgrown contact managersbut cannot afford the cost and complexity

of high-end CRM systems.


SALESLOGIX - THE PROBLEM

Existing CRM solutions fall into one of two categories.

One the one hand, you have Contact managers like Act and GoldMine that salespeople love but that do not allow people to share information across a large organization.

On the other hand you have high-end CRM systems like Siebel that will scale to support the needs of hundreds or thousands of users but that salespeople refuse to use.

ContactManagers

High-EndCRM

Systems


SALESLOGIX - THE PAIN

The result is that too many organizations are unable to…

• Coordinate the efforts of their sales and customer service teams• Obtain a holistic picture of the customer• Maximize the revenue gained from each customer


SALESLOGIX - THE SOLUTION

SalesLogix is the CRM system that delivers the best of both worlds…

• The ease of use of a contact manager

• The scalability, database synchronization, and reporting capabilities of a high-end CRM system

ContactManagers

High-EndCRM

Systems

SalesLogix


SALESLOGIX - THE BENEFITS

SalesLogix…

• Makes salespeople happy by giving them tools that save them time

• Makes sales managers happy by giving them the reports that they need

• Makes I.S. people happy by using industry-standard databases like Oracle and Microsoft SQL Server


SALESLOGIX - THE TEAM

The SalesLogix team has over 50 years of combined experience building and selling CRM systems.

The team is led by Pat Sullivan, the former co-founder and CEO of Contact Software International, the company that developed Act, the most widely used contact manager.


SALESLOGIX - THE MONEY

SalesLogix is seeking $5 million to finance the continued development and marketing of SalesLogix 1.0, which is scheduled to be released in April 1997.


FrequentlyMade

Mistakes


GETTING LOST IN THE “HOW”

• Excessive (or exclusive) focus on Howyour innovation works

• Common mistake of engineers– They answer the questions they would ask, not the

questions an investor or customer would ask

• Your listener probably doesn’t understand the technology (and doesn’t care)

• Don’t get into the How until later presentations


MISMATCHED MESSAGE

• People are used to giving one type of message to one type of audience– Assume it will work universally

• Must tailor the message to the audience• Investors want to hear about upside potential

– Size of market– Willingness to pay

• Customers want to hear about benefits– How will this save me time?– How will this save me money?– How will this make me money?


HYPE-erbole

• “This is the greatest invention since sliced bread”– “This is a multi-billion dollar market.”– “If we can get just 1% of this market…”

• Will turn people off– People are skeptical

• If it sounds too good to be true, it probably is

– You will seem unfocused– You will come across as naïve

• Selling is harder than you think

• Be enthusiastic but don’t overstate your case


NOT GETTING TO THE POINT

• Too many people save the best for last– But there’s so much more…– I could never do it justice– Trying to intrigue people

• Experienced people put the best information first• Tell them what you’re going to tell them…• Start off with an executive summary

– Single phrase that addresses The Problem and The Solution

– You only have a limited amount of time– Be prepared to be cut off at any moment


NO STATEMENT OF THE PROBLEM

• Merely different• Excessive focus on…

– The opportunity– The potential– The solution

• Never explain what’s wrong with state of the art– Most people hate to change– What will drive people to change?

• Hypothetical problem– No establishing that a problem truly exists

• Solution In Search Of A Problem


NO STATEMENT OF THE BENEFIT(S)

• All features and technology– All How

• The benefits are what most people care about• Expect benefits to be self-evident

– Too often benefits are only clear to an expert

• Put benefits at the end of the pitch– Should be at the front– Why will customers care?


MBA-itis

• Excessive use of…– Jargon– Buzzwords– Acronyms

• Speak English• How would you explain this to…

– Your spouse– Your child– Your father– Your grandmother


NOT ESTABLISHING CREDIBILITY

• What are your qualifications to solve this problem?– Credibility– Credentials– Experience– Contacts

• Do you really understand the problem?– Have you lived with it?– Is this a real solution to a hypothetical problem?


TRYING TO IMPRESS PEOPLE

• Some cultures = IQ driven– Big words– Acronyms

• You’re not operating in that world• Different audience = different vocabulary


SWALLOWING AN ELEPHANT

• Trying to conquer a market in one fell swoop– Expensive– Time-consuming

• Must break a market up into bite-sized chunks


In Summary


DOs AND DON’Ts

• Do…– Speak English– Tailor your message to the audience– Mention patents or exceptional experience

• Don’t…– Get lost in the “How”– Try to impress people with how smart you are– Oversell or overpromise– Say things like…

• “We have no competition”

• “If we can get just 1% of the market.”


THE FLOW OF AN ELEVATOR PITCH

• Summary Sentence• The Customer• The Problem• The Pain• The Solution• The Benefits• The Team• The Money• The Deal

• Don’t talk about The Technology


RESOURCES

• “Presenting to Win”– Jerry Weisman

• “How to Get Your Point Across in 30 seconds”– Milo O. Frank


CONTACT INFO

314.909.9760 - home314.494.1324 - cell

[email protected]

Slides Available Online atwww.thepowerofpain.com

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