T-M-I from T-I-M

Power Points: Presenter & Financials

It's about that time again for me to work with a few companies on their presentations to investors, which I do monthly.  What better time to give a few presentation tips?

1. One Presenter...the right one:  Dozens of times I've seen companies attempt to give a presentation of virtually any length by doing a "hand-off" from the CEO to the VP of Sales for example.  I've NEVER seen it work. 
   
   I recommend that any start-up choose the best presenter on the executive team to give the presentation.  The CEO pretty much has to be there, but they don't have to speak.  They can answer questions if necessary.  This is particuarly true with earlier stage companies because the founder is typically the CEO and is atypically anything close to Tom Peters.
   
   Bottom line:  You want to give it your best shot when presenting.  Take it by letting your best presenter present and if there are others who need to pitch in, let them do so during Q&A, not by fumbling an ill-advised hand-off.
2. Financials:  I'm a CPA, MBA, etc., etc.  There is only one thing you can say about financials with any type of absolute certainty:  EVERY NUMBER IS WRONG!
   
   It only matters how wrong they are and are they consistent with the story you are telling.  For me, I prefer to stick with 3-5 years of revenue projected in a bar graphy.  I also like, where applicable, a box on the slide showing a few pieces of relevant pricing data.   
   
   I am not a big fan of putting in expenses and detailed margin information.  I understand that the topic will be addressed beyond all reasonable limits throughout due diligence so you do need a financial model.  However, when the Q&A for a start-up presentation gets into the land of margins except at the very highest of levels, you are wasting your precious time.
   
   If they do, however, ask questions about the financials, I recommend to my clients that they say: 

"I'm thrilled that you are convinced on our business model so completely that the discussion is primarily financial at this point.  I'll address your question at a top level now and will be happy to share much more details on the model during your due diligence"

Pretty straightforward way to keep things on track.  For more info on me and my company, check out my website.

Power Points: Your Audience, Goal, Story and Self

From time to time I will blog on tips from the presentation front, use and share them freely!

This is right around the time that I work with a few start-ups every month as they prepare to present to one of the angel investment groups that I work with.  I know there are a million other "tips" out there.  That being said....

1. Audience Breakdown:  Take the time to fill out a simple grid that describes some of the attributes of your audience.  For the start-ups I give them industry breakdown (like 30% semiconductors, 20% software, 15% telco, 15% health care, 20% miscellaneous) age and sex.   
   
   It's important in this case for the start-ups because it tunes them into the fact that their pitch has to be understood by everyone, because angel investors frequently cross industry disciplines to invest.  However, Angel investors do not invest in that which they do not understand.
   
   For other situations, I suggest creating categories (like vendors, position at the company, technical knowledge).  Regardless, choose 3 and broadly sketch it out.
2. When they leave:  Given the above, what does the typical audience member have in mind when they leave or you finish your presentation.  With the start-ups, I always say get them thinking "This is interesting enough to go to due diligence".
   
   In almost all cases they won't invest.  So you don't have to tell them everything, just enough to get them thinking that.
3. Your Story:  For start-ups, it is super simple.  There's a big problem that you've solved uniquely and a bunch of people want that solution. 
   
   A sub-tip (if such a thing exists) here, if you are a start-up and you are presenting, give serious consideration to bringing a client if they are open to it.  After all everything is vaporware until its proven.  Bringing a client dispels a TON of questions and makes the presentation way easier.  I've rarely seen it, but it never fails.
4. Be Honest:  Do I make you horny?  Do I?  Sorry, a bit of Austin Powers for you.  Seriously, be honest with yourself and the investors.  In my estimation, the skills required of a CEO change 3 or 4 times SIGNIFICANTLY in the first 3-5 years of existence of a start-up. 
   
   As a CEO, if you believe you can change and succeed, say it.  If you think that an investor's money is better managed by bringing in the best suited person to run an organization at the time and you can handle it say it.  I end up being a quasi-therapist for a lot of start-up CEO's I interact with.  That's fine by me, I'm well suited for that approach. 
   
   I strongly suggest that any executive going to raise money do a self-assessment before raising money.  Let's face it, raising money is like getting a root canal from a proctologist.