Remember, your slides are meant to whet their appetite. While there’s no exact number that will be right for every business, you should be able to convey all the key details of your company in 12 slides. If you have too many and you present in person, you’ll feel as if you have to rush through your presentation to get to them all. Present your text primarily in short, bulleted points. You rarely need whole sentences. Put no more than three to five bullet points on a slide.
If you present your slides in person, practice first. Make certain you feel comfortable working with the computer and the software so that you’re not distracted during your meeting.
REAL-WORLD RECAP
What to include in your pitch
■ What your business makes or does
■ What market you serve
■ How you plan to make money
■ How your business compares to other, familiar businesses
■ Why you will succeed
■ Your ultimate goals for the business
Your elevator pitch
Before considering a prospective investment, venture capitalists and other investors often want to hear what they call the elevator pitch. This is the concise description of a company—its product or service, its market, its competitive advantages—that an entrepreneur could give in the time it would take to ride up an elevator (and not an elevator in a skyscraper!). An elevator pitch shows that you understand your business. (If you’re unclear on your strategic position, you’d still be mumbling as you pass the fifteenth floor.)
Your elevator pitch doesn’t have to be made in an actual elevator to be useful. You’ll find you’ll use it often: in emails to prospective financing sources, to introduce yourself and your company at networking events, and to deftly and briefly describe your business to potential customers.
It takes some thinking to decide which aspects of your business to mention in an elevator pitch. Even more frustrating, you have to decide which parts of your company to leave out. Often, these can be the things you’re most excited about—a new technology, a great location, and the fact you get to go to Europe on buying trips. But if they’re not central to the core of your business, they don’t belong in an elevator pitch.
Your elevator pitch must not only be short, it must be clear. Unless you operate in a highly technical field, your neighbor or grandmother should be able to understand your business well enough to be able to describe it to someone else. A good elevator pitch offers the following information:
Sample elevator pitches
■ “We design, install, and maintain landscaping for high-end residences and estates.”
■ “We audit manufacturing facilities for energy efficiency and find solutions for increased energy efficiency.”
■ “We build high-quality oak furniture in the Mission style for people with traditional tastes.”
■ “We create cloud-based software to automate bookkeeping and accounting for small- to medium-size businesses.”
■ What your business makes or does. This should be very brief: “My company manufactures water- and weather-proof, solar-powered outdoor lights.”
■ What market you serve. You should be very specific about this: “Fifteen-to 30-year-old males who daily play video games” or “Small businesses with five to 10 employees.”
ENTREPRENEUR’S WORKSHEET
Your Elevator Pitch
Use this worksheet to develop the main components of your elevator pitch. Then edit your responses to fewer than 100 words. Remember to keep your pitch short. Focus on what customers get, not on what you do. And make your pitch easy to remember.
■ How you plan to make money. This is very important if you give your elevator pitch to potential investors. Because they’ll want to know how you will earn a profit, you need to be very explicit about the business model you plan to employ. For example, “We will charge a monthly subscription ranging from $5 to $25 per user.”
■ How your business compares to other, familiar businesses. If you compare your business to other similar businesses, people may more easily understand what your product or service is all about. For example, a new social networking site for lawyers might be described as “Like Facebook for law-firm employees.” Or a new airline might be described as “A discount carrier with more frequent service than XYZ regional airline.”
■ Why you will succeed. What market conditions will make your idea a surefire success? You need to use all your powers of persuasion here. If you have any hard numbers to back up your assertions, so much the better: “Census figures show that families with young children are moving into this area at a rapid pace (up 27% over the previous decade), and those families will require housing.”
■ Your ultimate goals for the business. Do you want to eventually run a multinational corporation, or do you want to keep it relatively small and contained? You should be prepared to articulate your vision for the business’s size and reach.
See page 97
Classes and Competitions
You may prepare a business plan for a class assignment or to enter a business plan competition (often with significant cash awards). One major difference in preparing a business plan for a class or competition is that you’re much more likely to work with a team—as equals—rather than have one entrepreneur with a vision driving the process and making the final decisions.
Another major difference from the “real world” is the way your plan will be judged. Professors and competition judges typically place more emphasis on the quality of the written plan itself than potential funders do. And in the real world, potential funders will base far more of their decisions on the capabilities of the key founders than competition judges or professors will.
The team process
One of the major challenges of developing a business plan for a class or competition is working with a team. Mastering the dynamics of working together in a group—how to reach decisions, allocate tasks, communicate, and so forth—will help prepare you for the very real situations you’ll face when developing an actual business. The following key steps will help you manage your competition process.
■ Choose your team. Your people determine your success. Unlike with an actual business, you don’t always have the option of jettisoning members of your class or competition team. So choose carefully, and look for balance among the functional areas you’ll put in your plan: Having four great marketers may be overkill, leaving you without sufficient depth in operations, technology, or finance.
■ Make decisions. The first decision any group must make is to decide