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You’re the Boss Blog: Making Your Best Pitch

October 31, 2012 by Leave a Comment
Make Your Pitch

Film your business plan and send it to us.

It’s time to wrap up Make Your Pitch, and it is striking to me that even with the feedback on each pitch, we received very few pitches that nailed it. That being the case, I thought it might be useful to review some of the lessons we’ve learned.

Specifics trump generalities: Concrete figures, numbers and statistics add scale or a benchmark to your opportunities and accomplishments. Saying that I have raised a lot of capital for companies does not have nearly the impact of stating that I have raised more than a billion dollars. Saying you have a large market opportunity doesn’t resonate in the way that saying you have had $50 million in revenue in four years does. Specific numbers create context, whether perceived or real.

Use the same specifics-over-generalities approach in the tactics portion of your pitch. In the TugCam pitch, for example, instead of glossing over marketing, the pitchers said specifically that they were going to leverage insurance companies who were willing to provide policy discounts as a means to reach the end users. The more detailed you can be, the better.

Founders can inspire confidence: The video pitchers have ranged from very nervous to cool and collected. While being in front of a camera — or even another person — can be a bit uncomfortable or intimidating, it’s critical to remember that the main thing that an investor is banking on is you. You have to instill confidence that you are someone who can execute, and if you come across as anything less than fully confident, your chances of executing a successful pitch are slim-to-none. Also, know the difference between being confident and being arrogant. Being secure is desirable, but being a know-it-all is a turn-off.

Simplicity sells: In terms of business models, the KISS principle (Keep it simple, stupid) continues to reign. The more complicated the business opportunity, the more challenging it is to understand and to execute. Do something and do it well; then, you can branch out into additional products and services. If you try to accomplish too much up front, you risk losing investor interest.

Take some risk out: To investors, ideas are interesting, but execution is better. Plus, the more you can achieve in terms of milestones, the less risk there is for an investor. This can range from creating prototypes to finding paying customers. The more risk you take, the less you demand of an investor, which increases your credibility, shows that you have skin in the game, and demonstrates that you can execute.

Explain how you are making money: No idea is interesting to investors if they can’t make money from it. Be clear on the business and revenue model. How much do your products or services sell for? What kind of profit margins are there? How exactly do you make money? This is a critical focus for any business and needs to be addressed clearly and concisely.

Anticipate and counter objections: When you discuss your business idea or practice a business interview, there are going to be objections — stumbling blocks that will come up over and over from any savvy investor or interviewer. Know what those objections are and address them up front. Hestia Tobacco did that effectively when it acknowledged that it had a major competitor, American Spirit. Where you can, be sure to anticipate negatives, address them head-on and turn them into positives.

Communicate your differences: Ideas are only as good as the execution behind them. When you pitch, be clear about your secret sauce. Tell the investor what you are doing that is different from what everyone else does. Also, be clear if you have any protection on your difference (such as partnerships, patents, etc.). Furthermore, when it comes to execution, be clear about experience, qualifications and resources that you bring to the table to make you the absolute best person or team to dominate your market opportunity.

Know what you want — and communicate it: AmericanWay was very clear in its pitch that it was looking for a loan at a certain interest rate. Know what you are seeking from an investor in terms of the amount of capital and what it will be used for. Be clear about whether you are looking for equity investors or lenders (or perhaps you are flexible). A great pitch can be wasted if you don’t conclude by suggesting the next step.

This may seem like a lot of information to incorporate into a short pitch, but with practice, you can nail it.

I wish you much success in your professional endeavors.

Carol Roth is a business strategist who has helped clients raise more than $1 billion in capital. You can follow her on Twitter.

Article source: http://boss.blogs.nytimes.com/2012/10/31/making-your-best-pitch/?partner=rss&emc=rss

Filed Under: Small Business Tagged With: , ,

She Owns It: A Tutoring Company Learns a Lesson

December 1, 2011 by Leave a Comment

She Owns It

Portraits of women entrepreneurs.

In my last post, Alexandra Mayzler pondered the best way to train the tutors she hires to work for her company, Thinking Caps Tutoring. She had devised a manual but feared she wasn’t presenting the information it contained in a compelling or memorable way.

At the last meeting of the group, Ms. Mayzler said reader comments prompted a breakthrough for her. “I’d kept thinking of staff as one entity and students as another, but at the end of the day we’re all students,” she said. Or, as two commenters, Jen from New York and Dan from Syracuse put it, “learners.”

Ms. Mayzler said she realized her training efforts were “just teaching.” With that insight, she considered the methods Thinking Caps uses to teach students. A Thinking Caps tutor would never expect a student to spend a 60-minute session reading from a textbook, she said. But that was how she trained her tutors. There was virtually no interactivity.

By contrast, during a student lesson, tutors give examples, show videos and “grab the computer and look at different Web sites,” she said. They break subjects up. For example, covering just one topic in chemistry, not the entire subject, in an hour.

When a business group member, Susan Parker, who owns the dress manufacturer BariJay, asked how many tutors are trained at once, Ms. Mayzler said that was another thing she was reconsidering. Initially, tutors were trained one-by-one. But as their numbers grew, they were trained in groups — without much forethought. “I realized, if you have four people, shouldn’t they be role-playing and asking each other questions?” said Ms. Mayzler. Going forward, she plans to harness the strength of the group, taking a more deliberate approach.

She has allocated half of November, December, and January to hammering out the specifics. “I decided it would make sense to use the exact model — we have a very specific way of structuring a lesson — in creating our training modules for the tutors,” Ms. Mayzler said. She also decided to get some help, and is working with a Thinking Caps employee, a former teacher, to draft an interactive training process, which she hopes to complete by January.

Ms. Mayzler asked a group member, Jessica Johnson, how her business, Johnson Security Bureau, communicates its protocols to its security guard employees. Ms. Johnson said that during orientation, new employees receive classroom training in company policies, and a written document. Later, they can access the policies on the company’s intranet site. For Ms. Mayzler, the mere use of the word “orientation” was a revelation. She was amazed by how much better it sounded than “polices and procedures,” the term she had been using.

In future posts, we’ll catch up with the other group members and check Ms. Mayzler’s progress.

You can follow Adriana Gardella on Twitter.

Article source: http://feeds.nytimes.com/click.phdo?i=1ea00cdb6ca89d9750d230893c1bea89

Filed Under: Small Business Tagged With: , ,

Shortcuts: Why Doing the Ethical Thing Isn’t Automatic

November 20, 2011 by Leave a Comment

Putting aside the specifics of each case, one question that has come up is, “What would I do?” That is, if I saw what seemed to be a crime or unethical act committed by a respected colleague, coach, teacher or friend, would I storm in and stop it? Would I call the authorities immediately? Would I disregard the potentially devastating impact on my job or workplace or beloved institution?

Absolutely, most of us would probably reply. I think so, others might respond. And the most honest answer? I don’t know.

As much as we would like to think that, put on the spot, we would do the right — and perhaps even heroic — thing, research has shown that that usually isn’t true.

“People are routinely more willing to be critical of others’ ethics than of their own,” said Francesca Gino, an associate professor at Harvard Business School, and two other authors in the journal article “See No Evil: When We Overlook Other People’s Unethical Behavior.” The article appeared as a chapter in the book “Social Decision Making” (Psychology Press, 2009). “People believe they are more honest and trustworthy than others and they try harder to do good.”

But our faith in ourselves isn’t borne out by history or research, something the Times columnist David Brooks pointed out in his column this week.

The most well-known example of this in academia is the experiment conducted by the Yale University psychologist Stanley Milgram in the early 1960s. In the experiment, participants were “teachers” and, unbeknown to the participants, the “learner” was really an actor. The teacher was to instruct the learner in word pairs. For every wrong answer, the teacher could shock the learner, increasing the intensity of the shock for each wrong answer.

In reality, there were no shocks (the teacher couldn’t see the learner), but the person administering the shocks didn’t know that. In fact, the learner would bang on the wall, supposedly in pain, as the shocks “increased.”

In the end, a majority of the “teachers” administered the strongest shock of 450 volts, and the experiment was replicated elsewhere with similar results. The findings are depressing — that ordinary people can be easily persuaded to do something they believe is wrong.

“People would sit there crying and sweating, but they didn’t want to be rude,” said Carol Tavris, a social psychologist and author of numerous books including, “Mistakes Were Made (But Not by Me)” (Harcourt, 2007). But most people say they believe they would act differently from the participants, despite evidence to the contrary, she said.

For example, Professor Gino said, she and her colleagues asked female job candidates what they would do if inappropriate comments were made in a job interview.

“Most said they would walk away or raise a red flag,” she said. “But in reality, when it happened, they didn’t do that. Across the board, research points to the fact that people want to behave well but give in to temptations.”

Research also shows that it is much easier to step over the boundary from ethical to unethical when there is a gradual erosion of moral values and principles rather than one big leap.

A 2009 article in The Journal of Experimental Social Psychology, also co-written by Professor Gino, used as an example an accounting firm that has an excellent relationship with a client company. The accounting firm, which receives tens of millions of dollars in fees from the client, approves the company’s high-quality and ethical financial statements.

For three years, everything is fine. But suddenly, in the fourth year, the company stretches and even breaks the limits of the law.

Another case? Same accounting firm, same client. This time, after the first good year, the client bit by bit pushes the ethical envelope over the next three years.

The accounting firm would be more likely to approve the financial statements in the second case than in the first, the article says.

One of the reasons, Professor Gino and her colleague write, is that “unethical acts can become an integral part of the day-to-day activities to such an extent that individuals may be unable to see the inappropriateness of their behaviors.”

E-mail: shortcuts@nytimes.com

Article source: http://feeds.nytimes.com/click.phdo?i=755ead72036f6614f54329b25706c3b4

Filed Under: Your Money Tagged With: , ,