My first business pitch totally sucked.
I had worked as a tour guide in Europe and I wanted to set up my own tour company. I needed a few grand to get things going.
Palms sweating, I called my uncle (he was loaded). I wanted an investment of $5k; probably what he spent on cigars and port per week.
The phone rang, once, twice. I imagined him hobbling to the phone in his bathrobe, down the long hallway of his Northern Maine mansion. The money was pocket change for him. So why was I so nervous?
I realized I was nervous because — even though I knew my idea was good — I didn’t know how to convince him it was good. I needed to make him interested enough to invest.
He picked up the phone, I explained my business idea, and then I asked him for the money.
“You haven’t really convinced me,” he said, and we hung up. I felt defeated.
But this didn’t stop me, and I figured out a way to start my tour company. And it was pretty successful.
But I couldn’t stop thinking about why I hadn’t been able to convince my uncle to invest in my business.
I realized having a great business idea is completely separate from convincing other people that you have a great idea.
But it’s also an irreplaceable part of a business pitch.
So to go a little bit deeper, I checked in with an an expert.
Jim Cogan’s used to persuading people he’s right, even when talking about something that makes his blood boil. Jim’s a former speech writer for San Jose’s City Council, the 3rd largest city in California.
One time he wrote a bunch of speeches trying to persuade the city to put adult filters on library computers.
Jim thought it was a bad idea. The filters blocked a ton of non-pornographic content just because it had “shit” or “fuck” in the text, among other things. But his job was to convince people that the filters were a good idea.
So what’s his persuasion process? I wanted to bullshit like the best, and he’s one dude who knows how to make this happen.
Philosophy is the key to success
Jim prepped for his day job by studying philosophy in college, but that’s not necessary for every startup founder. You just need to work on detaching yourself from the outcome of your argument.
It sounds counter intuitive, but actually the less you personalize something, the more objective and worthy of trust you can be.
Basically, the best way to argue is with cold, hard logic.
Your goal should be:
- Emphasize the “wins” of your plan.
- Know your weak spots and talk to people about how to deal with them.
- Take some space from your business idea. Don’t over-identify with it or you might get defensive. You need to be open to failure, even if that hurts.
Jim explains that it’s hard to remove emotion from your startup, but the more you do, the more people will trust you to tell them what’s really going on.
And if you weren’t masochistic enough to study debate or philosophy in college, there’s still time to learn how to think like a philosopher.
Last week, a story went viral about a group of prison inmates at New York’s Eastern Correctional Facility that won a debate against Harvard University’s award-winning debate team. And the prisoners were arguing a point they didn’t agree with.
So what can we learn from this?
When you pitch your business plan to investors, remember to get out of your own way. Put all your feelings (fear, anxiety, eagerness) aside, and walk in like it’s a job interview.
Because… it is.
“You have to make a distinction between [your job] and your own opinions or feelings … It’s like being a house painter,” Jim said. “Sometimes someone picks a color that you don’t particularly like and if that’s the color they want, that’s the color they want.”
Stay away from bullshit
You might think your startup is “the Uber of the future” or “Google for dogs,” but using outlandish exaggerations, and words like “best,” “greatest,” and “smartest,” makes you seem naive.
Use the ‘Rule of Three’ to get noticed
If you want people to remember your idea, repeat it three times during a pitch or conversation. Figure out a way to make this feel natural.
Once could be when you introduce yourself and your idea. Or you could print your company slogan on your business cards and knock one of those out of the way right off the bat. Just remember, the power of three is real.
If someone’s doing something similar to you and it’s going great, don’t be afraid to mention this. Sure, you might seem unoriginal. But this means you’re on to something and there’s proof that it works. Example: Uber and Lyft.
And make sure to mention any investors you have; that’s social proof someone else believes in you. (Unless it’s your Dad).
Sometimes it helps to light a little fire under people by letting them know that the opportunity to fund you won’t be around forever. Because you’re baller, right?
Creating the appearance of immediacy or limited supply makes whatever you’re offering way more attractive.