1/ Before writing a startup deck or pitching investors you should identify the nucleus of your story and how it could be a $1b+ company.
This should be a two sentence story that you then build the rest of your pitch around.
And you should truly believe in your story.
2/ When I started @BankMercury in 2017 our story was:
"Business banking is a $300b+ market, but banks aren't technology companies. Tech companies will disrupt all of banking as seen in consumer. Serving startups 1st allows us to grow with them and they care most about product"
3/ The best stories show:
- How big the market is
- Why now is the right time for your startup idea
- Why yours' is the right approach
- why you are the right founder to do it
You have to pick the elements that are most relevant+important for your story.
4/ There are obviously additional parts to add to that initial story to make a full pitch (like team, distribution, competition, traction etc).
But once you have a compelling nucleus you can build the rest of the pitch on top of that.
5/ I often see pitch decks or hear pitches where the entrepreneur is jumping from one slide to another without an underlying story that ties it all together.
At the end of the pitch I am left wondering “how can this be a big company?” or not engaged with the idea.
6/ The story is the main thing you are selling at an early stage. Make sure that it is compelling first then add the other parts.
Reply with your startup's 2 sentence story and happy to give some feedback.
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We are going to try to make this a fast paced convo that skips the basics and goes deep on the subject.
Some subjects:
- why did European challenger banks fail on their US expansion
- will the big banks be able to keep market caps as fintech continues to grow exponentially
3/
- will more challenger banks get bank charters
- what’s the future of partner banks and BaaS
- will embedded banking disrupt challenger banks
1/ As an investor you are often making very quick decisions about startups.
Here are some questions I think about:
Team:
- have they built something impressive before
- have they thought about the problems deeply
- have they shown perseverance
- do they care about the problem
2/
Market:
- could this be a $10b company if things went right
- if in a pre-existing large market a) are the incumbents old/un-innovative, b) do founders understand customers enough to find a wedge
- if new market a) how big can this grow in optimistic case, b) why now
3/
Future:
- is it inevitable that this will exist in 10 years time
- are there likely to be lots of competitors
- is there strong network effect at scale?
- will it improve the world 🌎
In winter 2009 Paul Buchheit (@paultoo) gave a talk to our YC batch.
He said if you want money you should go work at Google/Facebook instead of doing a startup and you should do a startup if you enjoy the journey.
I thought he was crazy at the time.
2/ I thought:
A) I wanted the end result and didn’t care much about they journey
B) Startup founders seemed to have such great exits
C) It seemed like doing a startup was pretty hard
D) I didn’t think people got paid that much at big cos
3/ Between 2009 and 2015, Paul was proven extremely right.
All my friends who had taken jobs at those big companies or other high growth startups had done very well.
1/ My fav "how to sell" book is "Never Split the Difference" by @VossNegotiation
One particular technique in it has come in super useful as an entrepreneur. It basically talks about never accepting the first "No" you get and ask 4 times in different ways
2/ We at @BankMercury always want to help entrepreneurs succeed and one of the biggest asks we get is startups wanting to connect with investors.
Instead of trying to accommodate these asks on a one off basis we decided to productize the process.
3/ We ran a small beta last month and were surprised by the level of interest from both entrepreneurs and investors. Both sides are looking for better tools to connect.
The beta resulted in 20 intros between startups and investors and at least 2 checks.
1/ One of the trickiest parts in a fundraising pitch is what to say when investors bring up an issue that is about a fundamental, unavoidable risks.
Every business at every stage has them, things like “what if Google enters your market?”, “what if CAC goes up”.
2/ My initial instinct is to turn these into discussions. “Great question, that would be bad, what do you think we should do?”.
I have noticed that devolves into a long, negative conversation that doesn’t resolve the issue and makes it seem like an even bigger deal than it is.
3/ What works is to have strong counter arguments that don’t leave too much room for discussion.
Question: what if Google enters the market?
Answer: Google has shown they don’t care about this market, the last 5 products they launched were a flop and it’s a huge market anyway.