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June 22, 2004 9:14 PM

The Torturous World of Powerpoint

I've looked at thousands (tens of thousands?) presentations pitching new businesses since the mid 1990's. The vast majority of them suck. Unfortunately, it's not Powerpoint's fault (no - it wouldn't be better if Freelance has become the standard).

It's the content creators fault. Edward Tufte - a master of The Visual Display of Quantitative Information, thinks Powerpoint is evil and corrupts absolutely. Blogs like Beyond Bullets help reduce the corruption, but given that I'm trying to get a very specific set of information in a short period of time (usually 30 - 60 minutes), more specificity about what I think is "good" is probably helpful.

Several years ago, Chris Wand (one of the guys that works with me at Mobius Venture Capital) put together a list of questions that a pitch to a VC should address. The world would be a better place if all entreprenuers could automagically incorporate this outline into their pitches - at least to me.

Following are the questions to address.

1) WHAT IS YOUR VISION?
- What is your big vision?
- What problem are you solving and for whom?
- Where do you want to be in the future?

2) WHAT IS YOUR MARKET OPPORTUNITY AND HOW BIG IS IT?
- How big is the market opportunity you are pursuing and how fast is it growing?
- How established (or nascent) is the market?
- Do you have a credible claim on being one of the top two or three players in the market?

3) DESCRIBE YOUR PRODUCT/SERVICE
- What is your product/service?
- How does it solve your customer’s problem?
- What is unique about your product/service?

4) WHO IS YOUR CUSTOMER?
- Who are your existing customers?
- Who is your target customer?
- What defines an "ideal" customer prospect?
- Who actually writes you the check?
- Use specific customer examples where possible.

5) WHAT IS YOUR VALUE PROPOSITION?
- What is your value proposition to the customer?
- What kind of ROI can your customer expect by using buying your product/service?
- What pain are you eliminating?
- Are you selling vitamins, aspirin or antibiotics? (I.e. a luxury, a nice-to-have, or a need-to-have)

6) HOW ARE YOU SELLING?
- What does the sales process look like and how long is the sales cycle?
- How will you reach the target customer? What does it cost to "acquire" a customer?
- What is your sales, marketing and distribution strategy?
- What is the current sales pipeline?

7) HOW DO YOU ACQUIRE CUSTOMERS?
- What is your cost to acquire a customer?
- How will this acquisition cost change over time and why?
- What is the lifetime value of a customer?

8) WHO IS YOUR MANAGEMENT TEAM?
- Who is the management team?
- What is their experience?
- What pieces are missing and what is the plan for filling them?

9) WHAT IS YOUR REVENUE MODEL?
- How do you make money?
- What is your revenue model?
- What is required to become profitable?

10) WHAT STAGE OF DEVELOPMENT ARE YOU AT?
- What is your stage of development? Technology/product? Team? Financial metrics/revenue?
- What has been the progress to date (make reality and future clear)?
- What are your future milestones?

11) WHAT ARE YOUR PLANS FOR FUND RAISING?
- What funds have already been raised?
- How much money are you raising and at what valuation?
- How will the money be spent?
- How long will it last and where will the company "be" on its milestones progress at that time?
- How much additional funding do you anticipate raising & when?

12) WHO IS YOUR COMPETITION?
- Who is your existing & likely competition?
- Who is adjacent to you (in the market) that could enter your market (and compete) or could be a co-opted partner?
- What are their strengths/weaknesses?
- Why are you different?

13) WHAT PARTNERSHIPS DO YOU HAVE?
- Who are your key distribution and technology partners (current & future)?
- How dependent are you on these partners?

14) HOW DO YOU FIT WITH THE PROSPECTIVE INVESTOR?
- How does this fit w/ the investor’s portfolio and expertise?
- What synergies, competition exist with the investor’s existing portfolio?

15) OTHER
- What assumptions are key to the success of the business?
- What "gotchas" could change the business overnight? New technologies, new market entrants, change in standards or regulations?
- What are your company’s weak links?

Posted in: Venture Capital

COMMENTS (15)

This may be the most useful information I ever got for free... Thanks!

Tom Bartel , June 22, 2004 10:18 PM

Bill Joos had some interesting comments on this topic at last weeks' Art of the Start conference put on by Garage Technology Ventures. In particular, he pointed out his rule of "12 slides in 15 minutes" - his pet peeve is entrepreneurs who come in an take up the whole hour with their presentation. At first this may seem at odds with Chris' huge list of questions - you might think "how can I answer all those questions in 12 slides?" - by having your message crisp and well-defined.

One other interesting point Bill Joos raised: he's always surprised that entrepreneurs never start off their presentation by asking *them* questions. In particular, he thinks entrepreneurs would be well-served by asking two questions before presenting: "What attracted you to our company/business plan?" and "What are the top three things you would like to learn about our company/business plan in this presentation?"

(BTW: I'll be posting transcripts of the Art of the Start sessions as I have time. The first transcript, Guy Kawasaki's session on "The Art of Starting" is already available)

Brendon J. Wilson , June 23, 2004 12:20 AM

OK just a reality check, Brad: how many slides should the "ideal" (first) pitch be? I remember VC's saying more than 10 slides was too many. Your list above could cover a couple of dozen ...

Ed , June 23, 2004 12:26 AM

At the top of the list, I'd add the question "What's in it for ME (the VC)?" (Or, "How will I make money if I give you money?") The rest of the points are really a spectrum of potential answers to those questions. As Ed points out, there are a couple of dozen possible answers, but Brendan brings up a really good way to organize them - let the VCs decide by asking them what's on their minds first, then tailor the responses to their interests.

In PowerPoint you can allow for a much more flexible conversation by first presenting a provocative image and asking a question. For example, you could present a simple image of a wireless router against a simple white background, and say "What do you see is the potential profitability of the wireless market? Why hasn't any company been able to fully realize the potential?" After listening to the VCs' response, open your presentation in Slide Sorter view and go directly to the slide that connects with their interests -- "Well, we're different, because we've analyzed the weaknesses of other strategies, and have come up with an approach that connects where their signals have failed. Here are the numbers."

Using PowerPoint as a "show" constrains you to a pre-ordained sequence of slides that holds an audience captive and yes, often tortures them. No wonder VC's don't like PowerPoint, any more than most audiences. But if you look at PowerPoint's Slide Sorter view as your modular "presentation dashboard", you can select relevant slides that respond directly to the VCs interests, and produce a much more targeted, tailored, meaningful, and profitable experience for everyone.

Cliff Atkinson , June 23, 2004 11:46 AM

And how 'bout some questions for VCs?

-- How many companies have you started?
-- Have you ever sunk 100% of your savings into a start-up?
-- What percent of your investments do you kill or let wither?
-- What were three stupid investments you've made & what did you learn from them?
-- What's your favorite book?
-- What are the names and phone numbers of three folks you've fired or otherwise unsettled.

henrycopeland , June 24, 2004 8:06 AM

Of course, all the questions pale compared to # 6 -- HOW ARE YOU SELLING?

H

Halley Suitt , June 24, 2004 12:23 PM

Tim Oren responded to this item on his blog (which doesn't have comments enabled for some reason):

"One commenter suggests first engaging the VC in the meeting by asking their view of the market, and why the company was picked to pitch. I disagree on this one. I don't want my own views reflected back at me. I want to hear the entrepreneur's view of the market and the company's value add."

I believe Tim misunderstood my comment - I don't believe Bill Joos was suggesting entrepreneurs ask a VC ask these questions to enable them to parrot the VC's opinions. Instead, I believe the purpose of asking questions before the presentation is to allow the entrepreneur to engage the VC early in the presentation, gain insight into how they might tailor their message to the specific interests of the VC, rather than just flip into "presentation mode", blast their message out indiscriminantly, and then leg it out of there.

A presentation is like an accordian - you should be able to 'expand' or 'compress' the various sections according to your audience and their interests (expressed both overtly and implicitly through their questions, body language, etc). If, for example, the VC indicated that they were drawn to your business plan because they were quite familiar with the history of members of the management team, then you could probably compress the details of the management section of the presention and expand another area.

Tim goes on:

"The situation will get interactive soon enough if we're interested. At least at our place, it's a very bad sign to get through the first 15 minutes without being interrupted by questions."

This echoes a pet peeve expressed by Steve Jurvetson at a recent panel - entrepreneurs who weren't prepared to interact as part of the presentation and who cling to their slides and presentation format. After all, this is supposed to be a conversation - how comfortable will a VC be if you, the entrepreneur, appear to lack the confidence, vision, or in-depth understanding of your business to depart from your "script"?

Brendon J. Wilson , June 25, 2004 12:07 AM

While I agree in general that Powerpoint is often used for evil, I remember a bit I read in Wired and heard on NPR about David Byrne of The Talking Heads using Powerpoint to create art.

While this in no way refutes the common abuse of Powerpoint (to which I am often subjected as a VC), I do like the subversive nature of using PPT in a way it was surely never intended by its creators. Ironically, this "misuse" by users is perhaps an indicator of a successful product or technology.

DJ Alchemi has a good comprehensive discussion of the Tufte vs, Byrne "debate".

Ryan McIntyre , June 26, 2004 4:32 PM

So very true I had seen hundreds of good people presenting good ideas but in a very poor way!

The art of laying your idea's for someone else especially if you're not present to accompany the presentation can result and in most cases result
a very poor payoff for the work invested in creating this presentations just because they didn't follow this points!

Christina Theron , June 28, 2004 5:29 PM

Brad -- This is good stuff.

1. Although content is 99 percent of the game, tools do matter -- would you rather write a business plan in Word 2003 or Wordstar? Axon (www.axoninc.com) publishes a software package called Axon Solo that was designed for McKinsey and is a fantastic tool for creating presentations. PowerPoint's default templates are third grade at best, while Solo's templates provide the McKinsey look -- no 3D pie charts, just classic, basic, elegant design.

2. I get really pissed when at the beginning of the presentation someone doesn't provide me with a copy of the slides. I want to take notes and write down my thoughts, and to do so on a piece of paper that shows what I'm seeing on the screen.

3. In some cases it would make sense to have more detail on the printed copy. Every data should have a source and you might want to have the source on the printed copy but not the slide.

4. I want to be told where you're going. At the beginning, I want them to say, "I'm going to cover 10 points." The first slide lists those ten points. Each point is then numbered on the corresponing slide, so I can always know where I am in the presentation (and get a sense for how much longer it is going to last).

James Mitchell , February 21, 2005 9:04 AM

See also the work Eric Meyer did with S5, a slide show format based entirely on XHTML, CSS, and JavaScript.

at http://meyerweb.com/eric/tools/s5/

Kenneth , March 18, 2005 8:17 AM

Dont forget though, blamming PowerPoint for the bad presentation iis like blaming the pan for the crap food.

PowerPoint is a perfectly efficient tool that's badly used.

Also, people should stop thinlking about how to pitch to VCs as such and rather consider how to pitch to people in general.

The content should be specific. The methodology shouldn't...!

Rich...! , March 19, 2005 4:23 AM

Thanks for this list of questions. It came in handy when I was creating an outline for a meeting to scope out a new product/service for my company. Happy New Year.

B , January 5, 2006 7:43 AM

Ahh yes. The sales process. I believe there is a lot that should be behind the first bullet in #6:

"What does the sales process look like and how long is the sales cycle?"

In my work with clients over the past several years, I have learned that the majority of the companies I have worked with (both startups and the extremely large multi-billion dollar ones) really do not have their arms around the sales process - it gets paid a lot of lip service, but very few companies really understand it and attack it aggressively as a key element of their go-to-market activities.

Marketing and product management tend to invent the product to be sold and then throw it over the wall to the sales force, with mounds of documentation on what it is, spec sheets, capabilities, functionality, etc. and maybe a little bit about the intended market. This leaves the sales organization to figure out who to go sell it to and how to sell it. Missing are the answers to such questions as:
- exactly who should I be trying to see?
- how should I be positioning the product/service?
- how should I position the company?
- what questions should I be asking and why?
- how can I eliminate various competitors?
- what objections will I hear and how should I respond?

It amazes me how many marketers believe that sales people just naturally know how to do all the above - they were just born knowing what questions they should ask. They don't. And if they appear to, it is just because they have been selling a long time and have some experience to guide their actions, but even the most seasoned sales person has to "figure it out" to some extent.

While I would be impressed with anybody who could articulate their sales process, I think it goes far beyond the items in the Powerpoint presentation. There needs to be a linking of the marketing strategy to a documented set of actionable sales steps that can be used by all the company's sales people Day 1. The learning curve is VERY expensive not only in terms of time to revenue, but while they are figuring everything out sales people often miss opportunities that can not be recaptured later.

This is a great thought-provoking outline and I just had to throw in my 2 cents on the sales process item because I see it as a huge opportunity.

steve early , April 14, 2006 8:21 AM

Thanks for this list of questions. It came in handy when I was creating an outline for a meeting to scope out a new product/service for my company

Dallas , June 30, 2006 2:36 PM

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